SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 18, 1998
GMAC Commercial Mortgage Securities, Inc.
(Exact name of registrant as specified in its charter)
DELAWARE 333-37717 23-2811925
(State or other jurisdiction (Commission) (I.R.S. employer
of incorporation) file number) identification no.)
650 Dresher Road, Horsham, Pennsylvania 19044
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (215) 328-3480
Not Applicable
(Former name or former address, if changed since last report)
Exhibit Index Located on Page 4
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Item 2. Acquisition or Disposition of Assets.
On May 18, 1998, a single series of certificates, entitled GMAC Commercial
Mortgage Securities, Inc., Mortgage Pass-Through Certificates, Series 1998-C1
(the "Certificates"), was issued pursuant to a Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement"), attached hereto as Exhibit 4.1, dated
as of May 1, 1998, among GMAC Commercial Mortgage Securities, Inc. as depositor
(the "Depositor"), GMAC Commercial Mortgage Corporation as master servicer and
special servicer, LaSalle National Bank as trustee and ABN AMRO Bank N.V. as
fiscal agent. The Certificates consist of eighteen classes identified as the
"Class X Certificates," the "Class A-1 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," the "Class M Certificates," the
"Class N Certificates," the "Class R-I Certificates," the "Class R-II
Certificates" and the "Class R-III Certificates," respectively, and were issued
in exchange for, and evidence the entire beneficial ownership interest in, the
assets of a trust fund (the "Trust Fund") consisting primarily of a pool (the
"Mortgage Pool") of commercial and multifamily mortgage loans (the "Mortgage
Loans"), having as of the close of business on May 1, 1998 (the "Cut-off Date"),
an aggregate principal balance of $1,438,000,264 (the "Initial Pool Balance"),
after taking into account all payments of principal due on Mortgage Loans on or
before such date, whether or not received. The Depositor acquired certain of the
Trust Fund assets from GMAC Commercial Mortgage Corporation ("GMACCM") pursuant
to a mortgage loan purchase agreement dated April 28, 1998, attached hereto as
Exhibit 99.1, between GMACCM as seller and the Depositor as purchaser. The
Depositor acquired certain of the Trust Fund assets from German American Capital
Corporation ("GACC") pursuant to a mortgage loan purchase agreement dated April
28, 1998, attached hereto as Exhibit 99.2, between GACC as seller and the
Depositor as purchaser. The Depositor sold the Class X, Class A-1, Class A-2,
Class B, Class C, Class D, Class E and Class F Certificates to Deutsche Morgan
Grenfell Inc. ("DMG") and Lehman Brothers Inc. ("Lehman") as Underwriters
pursuant to an underwriting agreement dated April 28, 1998, attached hereto as
Exhibit 1.1, among DMG and Lehman as underwriters, GMACCM and the Depositor. The
Depositor sold the Class G, Class H, Class J, Class K. Class L, Class M, Class
N, Class R-I, Class R-II and Class R-III Certificates to DMG and Lehman pursuant
to a certificate purchase agreement dated April 28, 1998 among DMG and Lehman as
initial purchasers, GMACCM and the Depositor.
The Class X Certificates will not have an initial certificate balance
("Certificate Balance"), but will represent the right to receive distributions
of interest accrued as provided in the Pooling and Servicing Agreement on a
hypothetical or notional amount (a "Notional Amount") equal to $1,438,000,263.
The Class A-
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1 Certificates will have an initial Certificate Balance of $333,587,000. The
Class A-2 Certificates will have an initial Certificate Balance of $687,393,000.
The Class B Certificates will have an initial Certificate Balance of
$28,760,000. The Class C Certificates will have an initial Certificate Balance
of $64,710,000. The Class D Certificates will have an initial Certificate
Balance of $75,495,000. The Class E Certificates will have an initial
Certificate Balance of $68,305,000. The Class F Certificates will have an
initial Certificate Balance of $43,140,000. The Class G Certificates will have
an initial aggregate Certificate Balance of $32,355,000. The Class H
Certificates will have an initial Certificate Balance of $25,165,000. The Class
J Certificates will have an initial Certificate Balance of $14,380,000. The
Class K Certificates will have an initial Certificate Balance of $25,165,000.
The Class L Certificates will have an initial Certificate Balance of
$14,380,000. The Class M Certificates will have an initial Certificate Balance
of $10,785,000. The Class N Certificates will have an initial Certificate
Balance of $14,380,263. The Class R-I, Class R-II, Class R-III Certificates each
have an initial Certificate Balance of $0.
Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to them in the Pooling and Servicing Agreement.
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
List below the financial statements, pro forma financial information and
exhibits, if any, filed as part of this report.
(a) Financial Statements of Businesses Acquired.
Not applicable
(b) Pro Forma Financial Information.
Not applicable
(c) Exhibits.
Exhibit No. Document Description
- ----------- --------------------
1.1 Underwriting Agreement, dated as of April 28, 1998, among GMAC
Commercial Mortgage Securities, Inc. as seller, GMAC Commercial
Mortgage Corporation and Deutsche Morgan Grenfell Inc. and Lehman
Brothers Inc. as underwriters.
4.1 Pooling and Servicing Agreement, dated as of May 1, 1998, among GMAC
Commercial Mortgage Securities, Inc. as depositor, GMAC Commercial
Mortgage Corporation as master servicer and special servicer, LaSalle
National Bank as trustee and ABN AMRO Bank N.V. as fiscal agent.
99.1 Mortgage Loan Purchase Agreement, dated as of April 28, 1998, between
GMAC Commercial Mortgage Corporation as seller and GMAC Commercial
Mortgage Securities, Inc. as purchaser.
99.2 Mortgage Loan Purchase Agreement, dated as of April 28, 1998, between
German American Capital Corporation as seller and GMAC Commercial
Mortgage Securities, Inc. as purchaser.
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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 thereunto duly authorized.
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.,
Registrant
By: /s/ Elisa George
--------------------------------------
Name: Elisa George
Title: Vice President
Dated: May 28, 1998
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INDEX OF EXHIBITS
Exhibit Description
1.1 Underwriting Agreement, dated as of April 28, 1998, among GMAC
Commercial Mortgage Securities, Inc. as seller. GMAC Commercial
Mortgage Corporation and Deutsche Morgan Grenfell Inc. and Lehman
Brothers Inc. as underwriters.
4.1 Pooling and Servicing Agreement, dated as of May 1, 1998, among GMAC
Commercial Mortgage Securities, Inc. as depositor, GMAC Commercial
Mortgage Corporation as master servicer and special servicer, LaSalle
National Bank as trustee and ABN AMRO Bank N.V. as fiscal agent.
99.1 Mortgage Loan Purchase Agreement, dated as of April 28, 1998, between
GMAC Commercial Mortgage Corporation as seller and GMAC Commercial
Mortgage Securities, Inc. as purchaser.
99.2 Mortgage Loan Purchase Agreement, dated as of April 28, 1998, between
German American Capital Corporation as seller and GMAC Commercial
Mortgage Securities, Inc. as purchaser.
EXHIBIT 1.1
EXECUTION COPY
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
$1,301,390,000
Mortgage Pass-Through Certificates, Series 1998-C1
Class X, Class A-1, Class A-2, Class B,
Class C, Class D, Class E and Class F
UNDERWRITING AGREEMENT
----------------------
as of April 28, 1998
Deutsche Morgan Grenfell Inc.
31 West 52nd Street
New York, New York 10019
and
Lehman Brothers Inc.
Three World Financial Center, 20th Floor
New York , NY 10285
As Representatives of the several
Underwriters named in Schedule I hereto
Ladies and Gentlemen:
GMAC Commercial Mortgage Securities, Inc., a Delaware corporation (the
"Company"), proposes to sell to the Underwriters named in Schedule I hereto (the
"Underwriters"), for whom each of you is acting as representative (together, the
"Representatives"), the respective classes of Mortgage Pass-Through
Certificates, Series 1998-C1, that are identified on Schedule I, in each case,
having the initial aggregate stated principal amount (a "Class Principal
Balance") or initial aggregate notional principal amount (a "Class Notional
Amount") and initial pass-through rate set forth on Schedule I. The Class X,
Class A-1, Class A-2, Class B, Class C, Class D, Class E and Class F
Certificates (collectively, the "Certificates"), together with the Class G,
Class H, Class J, Class K, Class L, Class M and Class N Certificates issued
therewith, will evidence the entire interest in the Trust Fund (as defined in
the Pooling and Servicing Agreement referred to below) consisting primarily of a
pool (the "Pool") of multifamily and commercial mortgage loans (the "Mortgage
Loans") as described in the Prospectus Supplement (as hereinafter defined) to be
sold by the Company.
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The Certificates will be issued under a pooling and servicing agreement
(the "Pooling and Servicing Agreement") to be dated as of May 1, 1998 (the
"Cut-off Date") among the Company, as depositor, GMAC Commercial Mortgage
Corporation ("GMACCM"), as master servicer (in such capacity, the "Master
Servicer") and special servicer (in such capacity, the "Special Servicer"),
LaSalle National Bank, as trustee (the "Trustee") and ABN AMRO Bank N.V., as
fiscal agent. The Certificates are described in the Basic Prospectus and the
Prospectus Supplement (each as hereinafter defined) which the Company has
furnished to the Representatives.
Certain of the Mortgage Loans (the "GACC Mortgage Loans") will be acquired
by the Company from German American Capital Corporation ("GACC") pursuant to a
mortgage loan purchase agreement, dated as of April 28, 1998 (the "GACC Purchase
Agreement"), between the Company and GACC. Certain of the Mortgage Loans (the
"GMACCM Mortgage Loans") will be acquired by the Company from GMACCM pursuant to
a mortgage loan purchase agreement, dated as of April 28, 1998 (the "GMACCM
Purchase Agreement"), between the Company and GMACCM (the GMACCM Mortgage Loans,
together with the GACC Mortgage Loans, the "Mortgage Loans"). GACC and GMACCM
together constitute the "Mortgage Loan Sellers" and the GACC Purchase Agreement
and the GMACCM Purchase Agreement together constitute the "Purchase Agreements."
1. Representations, Warranties and Covenants.
1.1 The Company represents and warrants to, and agrees with the
Underwriters that:
(a) The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement (No. 333-37717) on Form S-3 for
the registration under the Securities Act of 1933, as amended (the "Act"),
of Mortgage Pass-Through Certificates (issuable in series), including the
Certificates, which registration statement has become effective, and a copy
of which, as amended to the date hereof, has heretofore been delivered to
the Representatives. The Company proposes to file with the Commission
pursuant to Rule 424(b) under the rules and regulations of the Commission
under the Act (the "1933 Act Regulations") a supplement dated April 28,
1998 (the "Prospectus Supplement"), to the prospectus dated December 17,
1997 (the "Basic Prospectus"), relating to the Certificates and the method
of distribution thereof. Such registration statement (No. 333-37717)
including exhibits thereto and any information incorporated therein by
reference, as amended at the date hereof, is hereinafter called the
"Registration Statement;" the Basic Prospectus and the Prospectus
Supplement and any information incorporated therein by reference
(including, without limitation, and only for purposes of clarification, any
information filed with the Commission pursuant to a Current Report on Form
8-K), together with any amendment thereof or supplement thereto authorized
by the Company on or prior to the Closing Date for use in connection with
the offering of the Certificates, are hereinafter called the "Prospectus"
and any diskette attached to the Prospectus is hereinafter called the
"Diskette." Any preliminary form of the Prospectus Supplement which 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
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"Preliminary Prospectus Supplement;" and any diskette attached to the
Preliminary Prospectus Supplement is hereinafter referred to as the
"Preliminary Diskette." As used herein, "Pool Information" means the
compilation of information and data regarding the Mortgage Loans covered by
the Agreed Upon Procedures Letter dated May 18, 1998 and rendered by Price
Waterhouse LLP (a "hard copy" of which Pool Information was initialed on
behalf of each Mortgage Loan Seller and the Company).
(b) The Registration Statement has become effective, and the
Registration Statement as of its effective date (the "Effective Date"), and
the Prospectus, as of the date of the Prospectus Supplement, complied in
all material respects with the applicable requirements of the Act and the
1933 Act Regulations; and the Registration Statement, as of the Effective
Date, did not contain any untrue statement of a material fact and did not
omit to state any material fact required to be stated therein or necessary
to make the statements therein not misleading and the Prospectus and any
Diskette, as of the date of the Prospectus Supplement, did not, and as of
the Closing Date will not, contain an untrue statement of a material fact
and did not and will not omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however, that neither the
Company nor GMACCM makes any representations or warranties as to the
information contained in or omitted from the Registration Statement or the
Prospectus or any amendment thereof or supplement thereto relating to the
information identified by underlining or other highlighting as shown in
Exhibit C (the "Excluded Information"); and provided, further, that neither
the Company nor GMACCM makes any representations or warranties as to either
(i) any information in any Computational Materials or ABS Term Sheets (each
as hereinafter defined) required to be provided by the Underwriters to the
Company pursuant to Section 4.2, or (ii) as to any information contained in
or omitted from the portions of the Prospectus identified by underlining or
other highlighting as shown in Exhibit D (the "Underwriter Information");
and provided, further, that neither the Company nor, except as contemplated
by Section 1.2(a), GMACCM makes any representations or warranties as to any
information regarding the Mortgage Loans or the Mortgage Loan Sellers
contained in or omitted from the portions of the Prospectus Supplement
under the headings "Summary of the Prospectus Supplement--The Mortgage
Asset Pool," "Risk Factors--The Mortgage Loans" and "Description of the
Mortgage Asset Pool" or contained in or omitted from Annex A to the
Prospectus Supplement or contained in or omitted from the Diskette (the
"Mortgage Loan Seller Information"), other than that any Mortgage Loan
Seller Information (exclusive of the information set forth on pages A-9
through A-13, inclusive, of Annex A to the Prospectus Supplement (the "Loan
Detail") and the information on the Diskette) that represents a restatement
or aggregation of the information on the Loan Detail, accurately reflects
the information contained in the Loan Detail; and provided, further, that
neither the Company nor GMACCM makes any representations or warranties with
respect to the Diskette to the extent that the information set forth in the
Diskette is different than the information set forth in the Loan Detail.
Neither the Company nor, except as contemplated by Section 1.2(a), GMACCM
makes any representations or warranties, however, as to the accuracy or
completeness of any information in the Loan Detail. The Company
acknowledges that, except for any Computational
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Materials and ABS Term Sheets, the Underwriter Information constitutes the
only information furnished in writing by or on behalf of any Underwriter
for use in connection with the preparation of the Registration Statement,
any preliminary prospectus or the Prospectus, and the Underwriters confirm
that the Underwriter Information is correct.
(c) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware and
has the requisite corporate power to own its properties and to conduct its
business as presently conducted by it.
(d) This Agreement has been duly authorized, executed and delivered by
the Company and, assuming due authorization, execution and delivery by the
Representatives on behalf of the Underwriters, constitutes a valid, legal
and binding obligation of the Company, enforceable against the Company in
accordance with the terms hereof, subject to (i) applicable bankruptcy,
insolvency, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights generally, (ii) generally principles of
equity, regardless of whether such enforcement is considered 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
that purport to provide indemnification for securities laws liabilities.
(e) As of the Closing Date (as defined herein), the Certificates will
conform in all material respects to the description thereof contained in
the Prospectus and the representations and warranties of the Company in the
Pooling and Servicing Agreement will be true and correct in all material
respects.
1.2 GMACCM represents and warrants to and agrees with you that:
(a) As of the Closing Date, the representations and warranties of
GMACCM in the Pooling and Servicing Agreement and in Section 4(b) of the
GMACCM Purchase Agreement will be true and correct in all material
respects.
(b) This Agreement has been duly authorized, executed and delivered by
GMACCM and, assuming the due authorization, execution and delivery by the
Representatives on behalf of the Underwriters, constitutes a valid, legal
and binding obligation of GMACCM, enforceable against GMACCM in accordance
with the terms hereof, subject to (i) applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally, (ii) general principles of equity, regardless
of whether such enforcement is considered 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 that purport to provide
indemnification for securities laws liabilities.
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1.3 Each Representative, on behalf of itself and each Underwriter,
represents and warrants to and agrees with the Company and GMACCM that:
(a) With respect to each class of Certificates, if any, to be issued
in authorized denominations of $25,000 or less initial principal balance or
evidencing percentage interests in such class of less than 20%, as the case
may be, the fair market value of all such Certificates sold to any single
Person on the date of initial sale thereof by such Underwriter will not be
less than $100,000.
(b) As of the date hereof and as of the Closing Date, such Underwriter
has complied with all of its obligations hereunder, including, without
limitation, Section 4.2, and, with respect to all Computational Materials
and ABS Term Sheets provided by such Underwriter to the Company pursuant to
Section 4.2, if any, such Computational Materials and ABS Term Sheets are
accurate in all material respects (taking into account the assumptions
explicitly set forth in the Computational Materials or ABS Term Sheets,
except to the extent of any errors therein that are caused by errors in the
Pool Information) and include all assumptions material to the preparation
thereof. The Computational Materials and ABS Term Sheets provided by such
Underwriter to the Company constitute a complete set of all Computational
Materials and ABS Term Sheets delivered by such Underwriter to prospective
investors that are required to be filed with the Commission.
1.4 Each Representative represents and warrants to the Company and GMACCM
that it has been authorized by each of the other Underwriters to execute and
deliver this Agreement on behalf of such Underwriters.
2. Purchase and Sale. Subject to the terms and conditions and in reliance
upon the representations and warranties herein set forth, the Company agrees to
sell to each of the Underwriters, and each of the Underwriters agrees, severally
and not jointly, to purchase from the Company, the actual or notional, as the
case may be, principal amounts or percentage interests set forth in Schedule I
hereto in the respective classes of Certificates at a price for each such class
set forth in Schedule I hereto. There will be added to the purchase prices of
the Certificates an amount equal to interest accrued thereon from the Cut-off
Date to but not including the Closing Date.
3. Delivery and Payment. Delivery of and payment for the Certificates shall
be made at the office of Orrick, Herrington & Sutcliffe LLP at 10:00 a.m., New
York City time, on May 18, 1998 or such later date as the Representatives shall
designate, which date and time may be postponed by agreement between the
Representatives and the Company (such date and time of delivery and payment for
the Certificates being herein called the "Closing Date"). Delivery of the
Certificates (also referred to herein as the "DTC Registered Certificates")
shall be made to the Representatives for the respective accounts of the
Underwriters through DTC, in each case against payment by the Underwriters to or
upon the order of each Mortgage Loan Seller by wire transfer in immediately
available funds of the amount to which such Mortgage Loan Seller is entitled in
accordance with the terms of an allocation agreement dated the date hereof (the
"Allocation Agreement"), to which each such Mortgage Loan Seller and the
Company, among others, are parties. As a further condition to the delivery of
the
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DTC Registered Certificates, each Representative shall have furnished by
telephonic notice to the applicable Mortgage Loan Seller the federal reference
number for the related wire transfer to such Mortgage Loan Seller and shall have
furnished to the Company each such federal reference number as soon as
practicable after such federal reference number becomes available.
4. Offering by Underwriters.
4.1 It is understood that the Underwriters propose to offer the
Certificates for sale to the public as set forth in the Prospectus, and the
Underwriters agree that all such offers and sales by the Underwriters shall be
made in compliance with all applicable laws and regulations. It is further
understood that the Company, in reliance upon a no-filing letter from the
Attorney General of the State of New York granted pursuant to Policy Statement
105, has not and will not file an offering statement pursuant to Section 352-e
of the General Business Law of the State of New York with respect to the
Certificates. As required by Policy Statement 105, each Underwriter therefore
covenants and agrees with the Company that sales of the Certificates made by
such Underwriter in and from the State of New York will be made only to
institutional investors within the meaning of Policy Statement 105.
4.2 It is understood that each Underwriter may prepare and provide to
prospective investors certain Computational Materials and ABS Term Sheets (each
as defined below) in connection with its offering of the Certificates, subject
to the following conditions to be satisfied by such Underwriter:
(a) In connection with the use of Computational Materials, such
Underwriter shall comply with all applicable requirements of the No-Action
Letter of May 20, 1994 issued by the Commission to Kidder, Peabody
Acceptance Corporation I, Kidder, Peabody & Co. Incorporated and Kidder
Structured Asset Corporation, as made applicable to other issuers and
underwriters by the Commission in response to the request of the Public
Securities Association dated May 24, 1994 (collectively, the "Kidder/PSA
Letter"), as well as the PSA Letter referred to below. In connection with
the use of ABS Term Sheets, such Underwriter shall comply with all
applicable requirements of the No-Action Letter of 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").
(b) For purposes hereof, "Computational Materials" as used herein
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" and "Collateral Term
Sheets" as used herein shall have the meanings given such terms in the PSA
Letter but shall include only those ABS Term Sheets or Collateral Term
Sheets that have been prepared or delivered to prospective investors by or
at the direction of such Underwriter.
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(c) (i) All Computational Materials and ABS Term Sheets provided to
prospective investors that are required to be filed pursuant to the
No-Action Letters shall bear a legend on each page including the following
statement:
"THE INFORMATION HEREIN HAS BEEN PROVIDED SOLELY BY [NAME OF
[APPLICABLE] UNDERWRITER]. NEITHER THE ISSUER OF THE CERTIFICATES NOR
ANY OF ITS AFFILIATES MAKES ANY REPRESENTATION AS TO THE ACCURACY OR
COMPLETENESS OF THE INFORMATION HEREIN. THE INFORMATION HEREIN IS
PRELIMINARY AND WILL BE SUPERSEDED BY THE APPLICABLE PROSPECTUS
SUPPLEMENT AND BY ANY OTHER INFORMATION SUBSEQUENTLY FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION."
(ii) In the case of Collateral Term Sheets, such legend shall
also include the following statement:
"THE INFORMATION CONTAINED HEREIN WILL BE SUPERSEDED BY THE
DESCRIPTION OF THE MORTGAGE POOL CONTAINED IN THE PROSPECTUS
SUPPLEMENT RELATING TO THE CERTIFICATES AND [, EXCEPT WITH RESPECT TO
THE INITIAL COLLATERAL TERM SHEET PREPARED BY THE UNDERWRITERS,]
SUPERSEDES ALL INFORMATION CONTAINED IN ANY COLLATERAL TERM SHEETS
RELATING TO THE MORTGAGE POOL PREVIOUSLY PROVIDED BY [NAME OF
[APPLICABLE] UNDERWRITER]."
The Company shall have the right to require additional specific legends or
notations to appear on any Computational Materials or ABS Term Sheets, the
right to require changes regarding the use of terminology and the right to
determine the types of information appearing therein. Notwithstanding the
foregoing, subsections (c)(i) and (c)(ii) will be satisfied if all
Computational Materials and ABS Term Sheets referred to therein bear a
legend in a form previously approved in writing by the Company.
(d) Such Underwriter shall provide the Company with representative
forms of all Computational Materials and ABS Term Sheets prior to their
first use, to the extent such forms have not previously been approved by
the Company for use by the Underwriters. Such Underwriter shall provide to
the Company, for filing on Form 8-K as provided in Section 5.9, copies (in
such format as required by the Company) of all Computational Materials and
ABS Term Sheets that are required to be filed with the Commission pursuant
to the No-Action Letters. Such 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
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Term Sheets described in this subsection (d) must be provided to the
Company not later than 10:00 a.m. New York time one business day before
filing thereof is required pursuant to the terms of this Agreement. Such
Underwriter agrees that it will not provide to any investor or prospective
investor in the Certificates any Computational Materials or ABS Term Sheets
on or after the day on which Computational Materials and ABS Term Sheets
are required to be provided to the Company pursuant to this Section 4.2(d)
(other than copies of Computational Materials or ABS Term Sheets previously
submitted to the Company in accordance with this Section 4.2(d) for filing
pursuant to Section 5.9), unless such Computational Materials or ABS Term
Sheets are preceded or accompanied by the delivery of a Prospectus to such
investor or prospective investor.
(e) All information included in the Computational Materials and ABS
Term Sheets shall be generated based on substantially the same methodology
and assumptions that are used to generate the information in the Prospectus
Supplement as set forth therein; provided, however, 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 delivered by such Underwriter that are
required to be filed were based on assumptions with respect to the Pool
that differ from the final Pool Information in any material respect or on
Certificate structuring terms that were revised in any material respect
prior to the printing of the Prospectus, such Underwriter shall prepare
revised Computational Materials or ABS Term Sheets, as the case may be,
based on the final Pool Information and final structuring assumptions,
circulate such revised Computational Materials and ABS Term Sheets to all
recipients of the preliminary versions thereof that indicated orally to
such Underwriter they would purchase all or any portion of the
Certificates, and include such revised Computational Materials and ABS Term
Sheets (marked, "as revised") in the materials delivered to the Company
pursuant to subsection (d) above.
(f) The Company shall not be obligated to file any Computational
Materials or ABS Term Sheets that have been determined to contain any
material error or omission, provided that, at the request of the applicable
Underwriter, the Company will file Computational Materials or ABS Term
Sheets that contain a material error or omission if clearly marked
"superseded by materials dated __________" and accompanied by corrected
Computational Materials or ABS Term Sheets that are marked "material
previously dated __________, as corrected." In the event that within the
period during which the Prospectus relating to the Certificates is required
to be delivered under the Act, any Computational Materials or ABS Term
Sheets delivered by an Underwriter are determined, in the reasonable
judgment of the Company or such Underwriter, to contain a material error or
omission, such Underwriter shall prepare a corrected version of such
Computational Materials or ABS Term Sheets, shall circulate such corrected
Computational Materials and ABS Term Sheets to all recipients of the prior
versions thereof that either indicated orally to such Underwriter they
would purchase all or any portion of the Certificates, or actually
purchased all or any portion thereof, and shall deliver copies of such
corrected Computational Materials and ABS Term Sheets (marked, "as
corrected") to the
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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).
(g) If an Underwriter does not provide any Computational Materials or
ABS Term Sheets to the Company pursuant to subsection (d) above, such
Underwriter shall be deemed to have represented, as of the Closing Date,
that it did not provide any prospective investors with any information in
written or electronic form in connection with the offering of the
Certificates that is required to be filed with the Commission in accordance
with the No-Action Letters, and such Underwriter shall provide the Company
with a certification to that effect on the Closing Date.
(h) 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 (d) above, or in the delivery of
the accountant's comfort letter in respect thereof pursuant to Section 5.9,
the Company shall have the right to delay the release of the Prospectus to
investors or to the Underwriters, 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 5.9 to file the
Computational Materials and ABS Term Sheets by the time specified therein.
(i) Notwithstanding anything herein to the contrary, for purposes of
this Agreement, neither the Preliminary Diskette nor the Diskette shall be
deemed to be Computational Materials or ABS Term Sheets.
Each Underwriter represents and warrants that, if and to the extent it
provided any prospective investors with any Computational Materials or ABS Terms
Sheets prior to the date hereof in connection with the offering of the
Certificates, all of the conditions set forth in clauses (a) through (h) above
have been or, to the extent the relevant condition requires action to be taken
after the date hereof, will be, satisfied with respect thereto.
4.3 Each Underwriter further agrees that, on or prior to the sixth day
after the Closing Date, it shall provide the Company with a certificate,
substantially in the form of Exhibit E attached hereto, setting forth (i) in the
case of each class of Certificates, (a) if less than 10% of the aggregate actual
or notional, as the case may be, principal balance of such class of Certificates
has been sold to the public as of such date, the value calculated pursuant to
clause (b)(iii) of Exhibit E hereto, or, (b) if 10% or more of such class of
Certificates has been sold to the public as of such date but no single price is
paid for at least 10% of the aggregate actual or notional, as the case may be,
principal balance of such class of Certificates, then the weighted average price
at which the Certificates of such class were sold expressed as a percentage of
the aggregate actual or notional, as the case may be, principal balance of such
class of Certificates sold, or (c) the first single price at which at least 10%
of the aggregate actual or notional, as the case may be, principal balance of
such class of Certificates was sold to the public, (ii) the prepayment
assumption used in pricing each class of Certificates, and (iii) such other
information as to matters of fact as the Company may
9
<PAGE>
reasonably request to enable it to comply with its reporting requirements with
respect to each class of Certificates to the extent such information can in the
good faith judgment of such Underwriter be determined by it.
5. Agreements. The Company agrees with the several Underwriters that:
5.1 Before amending or supplementing the Registration Statement or the
Prospectus with respect to the Certificates, the Company will furnish the
Representatives with a copy of each such proposed amendment or supplement.
5.2 The Company will cause the Prospectus Supplement to be transmitted to
the Commission for filing pursuant to Rule 424(b) under the Act by means
reasonably calculated to result in filing with the Commission pursuant to said
rule.
5.3 If, during the period after the first date of the public offering of
the Certificates in which a prospectus relating to the Certificates is required
to be delivered under the Act, any event occurs as a result of which it is
necessary to amend or supplement the Prospectus, as then amended or
supplemented, in order to make the statements therein, in the light of the
circumstances when the Prospectus is delivered to a purchaser, not misleading,
or if it shall be necessary to amend or supplement the Prospectus to comply with
the Act or the 1933 Act Regulations, the Company promptly will prepare and
furnish, at its own expense, to the Representatives on behalf of the several
Underwriters, either amendments or supplements to the Prospectus so that the
statements in the Prospectus as so amended or supplemented will not, in the
light of the circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus will comply with law.
5.4 The Company will furnish to the Representatives, without charge, a copy
of the Registration Statement (including exhibits thereto) and, so long as
delivery of a prospectus by an underwriter or dealer may be required by the Act,
as many copies of the Prospectus, any documents incorporated by reference
therein and any amendments and supplements thereto as the Representatives may
reasonably request.
5.5 The Company agrees, so long as the Certificates shall be outstanding,
or until such time as the several Underwriters shall cease to maintain a
secondary market in the Certificates, whichever first occurs, to deliver to the
Representatives the annual statement as to compliance delivered to the Trustee
pursuant to Section 3.13 of the Pooling and Servicing Agreement and the annual
statement of a firm of independent public accountants furnished to the Trustee
pursuant to Section 3.14 of the Pooling and Servicing Agreement, as soon as such
statements are furnished to the Company.
5.6 The Company will endeavor to arrange for the qualification of the
Certificates for sale under the laws of such jurisdictions as the
Representatives may reasonably designate and will maintain such qualification in
effect so long as required for the initial distribution of the Certificates;
provided, however, that the Company shall not be required to qualify to do
business in any jurisdiction where it is not now so 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 so subject.
10
<PAGE>
5.7 Except as herein provided, the several Underwriters shall be
responsible only for paying all costs and expenses incurred by them, including
the fees and disbursements of their counsel, in connection with the purchase and
sale of the Certificates.
5.8 If, during the period after the Closing Date in which a prospectus
relating to the Certificates is required to be delivered under the Act, the
Company receives notice that a stop order suspending the effectiveness of the
Registration Statement or preventing the offer and sale of the Certificates is
in effect, the Company will advise the Representatives of the issuance of such
stop order.
5.9 The Company shall file the Computational Materials and ABS Term Sheets
(if any) provided to it by the Underwriters under Section 4.2(d) hereof with the
Commission pursuant to a Current Report on Form 8-K by 10:00 a.m. on the morning
the Prospectus is delivered to the Underwriters or, in the case of any
Collateral Term Sheet required to be filed prior to such date, by 10:00 a.m. on
the second business day following the first day on which such Collateral Term
Sheet has been sent to a prospective investor; provided, however, that prior to
such filing of the Computational Materials and ABS Term Sheets (other than any
Collateral Term Sheets that are not based on the Pool Information) by the
Company, each Underwriter must comply with its obligations pursuant to Section
4.2 and the Company must receive a letter from Price Waterhouse LLP, certified
public accountants, satisfactory in form and substance to the Company, GMACCM
and their respective counsels, to the effect that such accountants have
performed certain specified procedures, all of which have been agreed to by the
Company, as a result of which they determined that all information that is
included in the Computational Materials and ABS Term Sheets (if any) provided by
the Underwriters to the Company for filing on Form 8-K, as provided in Section
4.2 and this Section 5.9, is accurate except as to such matters that are not
deemed by the Company to be material. The Company shall file any corrected
Computational Materials described in Section 4.2(f) as soon as practicable
following receipt thereof. The Company also will file with the Commission within
fifteen days of the issuance of the Certificates a Current Report on Form 8-K
(for purposes of filing the Pooling and Servicing Agreement).
6. Conditions to the Obligations of the Underwriters. The Underwriters'
obligation to purchase the Certificates shall be subject to the following
conditions:
6.1 No stop order suspending the effectiveness of the Registration
Statement shall be in effect, and no proceedings for that purpose shall be
pending or, to the knowledge of the Company, threatened by the Commission; and
the Prospectus Supplement shall have been filed or transmitted for filing, by
means reasonably calculated to result in a filing with the Commission pursuant
to Rule 424(b) under the Act.
6.2 Since December 31, 1997, there shall have been no material adverse
change (not in the ordinary course of business) in the condition of the Company
or GMACCM.
6.3 The Company shall have delivered to the Underwriters a certificate,
dated the Closing Date, of the President, a Senior Vice President or a Vice
President of the Company to the effect that the signer of such certificate has
examined this Agreement, the
11
<PAGE>
Prospectus, the Pooling and Servicing Agreement and various other closing
documents, and that, to the best of his or her knowledge after reasonable
investigation:
(a) the representations and warranties of the Company in this
Agreement and in the Pooling and Servicing Agreement are true and correct
in all material respects; and
(b) the Company has, in all material respects, complied with all the
agreements and satisfied all the conditions on its part to be performed or
satisfied hereunder at or prior to the Closing Date.
6.4 GMACCM shall have delivered to the Underwriters a certificate, dated
the Closing Date, of the President, a Senior Vice President or a Vice President
of GMACCM to the effect that the signer of such certificate has examined the
Pooling and Servicing Agreement and this Agreement and that, to the best of his
or her knowledge after reasonable investigation, the representations and
warranties of GMACCM contained in the Pooling and Servicing Agreement and in
this Agreement are true and correct in all material respects.
6.5 The Underwriters shall have received the opinions of Orrick, Herrington
& Sutcliffe LLP, special counsel for the Company and GMACCM, dated the Closing
Date and substantially to the effect set forth in Exhibit A and the opinion of
Maria Corpora-Buck, Esq., general counsel for the Company and GMACCM, dated the
Closing Date and substantially to the effect set forth in Exhibit B.
6.6 The Underwriters shall have received from Brown & Wood, LLP, counsel
for the Underwriters, an opinion dated the Closing Date in form and substance
reasonably satisfactory to the Underwriters.
6.7 The Underwriters shall have received from Price Waterhouse LLP,
certified public accountants, (a) a letter dated the date hereof and reasonably
satisfactory in form and substance to the Underwriters and their counsel, to the
effect that they have performed certain specified procedures, all of which have
been agreed to by you, as a result of which they determined that certain
information of an accounting, financial or statistical nature set forth in the
Prospectus Supplement under the captions "Description of the Mortgage Pool,"
"Description of the Certificates" and "Yield and Maturity Considerations" agrees
with the records of the Company and the Mortgage Loan Sellers excluding any
questions of legal interpretation and (b) the letter prepared pursuant to
Section 5.9 hereof.
6.8 The respective classes of Certificates shall have been rated as set
forth on Schedule I.
6.9 The Underwriters shall have received, with respect to the Trustee, a
favorable opinion of counsel, dated the Closing Date, addressing the valid
existence of such party under the laws of the jurisdiction of its organization,
the due authorization, execution and delivery of the Pooling and Servicing
Agreement by such party and, subject to standard limitations regarding laws
affecting creditors' rights and general principles of equity, the enforceability
of the Pooling and Servicing Agreement against such party. Such opinion may
express its reliance as to factual matters on representations and warranties
made by, and on
12
<PAGE>
certificates or other documents furnished by officers and/or authorized
representatives of, parties to this Agreement and the Pooling and Servicing
Agreement and on certificates furnished by public officials. Such opinion may
assume the due authorization, execution and delivery of the instruments and
documents referred to therein by the parties thereto other than the party on
behalf of which such opinion is being rendered. Such opinion may be qualified as
an opinion only on the laws of each state in which the writer of the opinion is
admitted to practice law and the federal law of the United States.
6.10 The Underwriters shall have received from Orrick, Herrington &
Sutcliffe LLP, special counsel to the Company, and from Maria Corpora-Buck,
Esq., general counsel to the Company, reliance letters with respect to any
opinions delivered to the rating agencies identified on Schedule I hereto.
6.11 The Underwriters shall have received from counsel to each Mortgage
Loan Seller, the opinions substantially to the effect set forth in Exhibit D-3A
and D-3B of the respective Purchase Agreements.
The Company will furnish the Underwriters with conformed copies of the above
opinions, certificates, letters and documents as they reasonably request.
7. Indemnification and Contribution.
7.1 The Company and GMACCM, jointly and severally, agree to indemnify and
hold harmless each Underwriter and each person, if any, who controls such
Underwriter within the meaning of either Section 15 of the Act or Section 20 of
the Securities Exchange Act of 1934 (the "Exchange Act"), from and against any
and all losses, claims, damages and liabilities caused by any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement for the registration of the Certificates as originally filed or in any
amendment thereof or other filing incorporated by reference therein, or in the
Prospectus or incorporated by reference therein (if used within the period set
forth in Section 5.3 hereof and as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto), or in the Diskette, or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, except
insofar as such losses, claims, damages, or liabilities are caused by any such
untrue statement or omission or alleged untrue statement or omission based upon
any information with respect to which the Underwriters have agreed to indemnify
the Company pursuant to Section 7.2; provided that the Company and GMACCM will
be liable for any such loss, claim, damage or liability that arises out of or is
based upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein relating to the Mortgage Loan Seller Information
or Pool Information only if and to the extent that (i) any such untrue statement
is with respect to information regarding the GMACCM Mortgage Loans contained in
the Loan Detail or, to the extent consistent with Annex A to the Prospectus
Supplement, the Diskette, or (ii) any such untrue statement or alleged untrue
statement or omission or alleged omission is with respect to information
regarding any or all of the Mortgage Loan Sellers or any or all of the Mortgage
Loans contained in the Prospectus Supplement under the headings "Summary of
Prospectus Supplement - The Mortgage Asset
13
<PAGE>
Pool," "Risk Factors - The Mortgage Loans" and/or "Description of the Mortgage
Asset Pool" or on Annex A to the Prospectus Supplement (exclusive of the Loan
Detail) and such information represents a restatement or aggregation of
information contained in the Loan Detail, or (iii) any such untrue statement or
alleged untrue statement or omission or alleged omission is with respect to
information regarding GMACCM or the GMACCM Mortgage Loans contained in the
Prospectus Supplement under the headings "Summary of Prospectus Supplement - The
Mortgage Asset Pool," "Risk Factors - The Mortgage Loans" and/or "Description of
the Mortgage Asset Pool" or on Annex A to the Prospectus Supplement (exclusive
of the Loan Detail), and such information does not represent a restatement or
aggregation of information contained in the Loan Detail; and provided that none
of the Company, GMACCM or any Underwriter will be liable in any case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein relating to the Excluded Information, except that
each of the Company and GMACCM will be liable to the extent any such loss,
claim, damage or liability is caused by errors in the portion of the Pool
Information relating to the GMACCM Mortgage Loans.
7.2 Each Underwriter agrees, severally and not jointly to indemnify and
hold harmless the Company, GMACCM, their respective directors or officers and
any person who controls the Company or GMACCM within the meaning of either
Section 15 of the Act or Section 20 of the Exchange Act to the same extent as
the indemnity set forth in clause 7.1 above from the Company and GMACCM to the
Underwriters, but only with respect to (i) the Underwriter Information relating
to such Underwriter or supplied by such Underwriter to the Company for inclusion
in the Prospectus Supplement and (ii) the Computational Materials and ABS Term
Sheets delivered to investors in the Certificates by such Underwriter, except to
the extent of any errors in the Computational Materials or ABS Term Sheets that
are caused by errors in the Pool Information. In addition, the Underwriter
agrees to indemnify and hold harmless the Company, GMACCM, their respective
directors or officers and any person who controls the Company or GMACCM within
the meaning of either Section 15 of the Act or Section 20 of the Exchange Act
against any and all losses, claims, damages, liabilities and expenses
(including, without limitation, reasonable attorneys' fees) caused by, resulting
from, relating to, or based upon any legend regarding original issue discount on
any Certificate resulting from incorrect information provided by such
Underwriter in the certificates described in Section 4.3 hereof.
7.3 In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be sought
pursuant to either Section 7.1 or 7.2, such person (the "indemnified party")
shall promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the reasonable
fees and disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the reasonable 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 mutually agreed to the retention of such counsel or
(ii) the named parties to any such proceeding (including any impleaded
14
<PAGE>
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. It is understood that the
indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the reasonable fees and
expenses of more than one separate firm for all such indemnified parties. Such
firm shall be designated in writing by the Representatives, in the case of
parties indemnified pursuant to Section 7.1, and by the Company or GMACCM, in
the case of parties indemnified pursuant to Section 7.2. The indemnifying party
may, at its option, at any time upon written notice to the indemnified party,
assume the defense of any proceeding and may designate counsel reasonably
satisfactory to the indemnified party in connection therewith provided that the
counsel so designated would have no actual or potential conflict of interest in
connection with such representation. Unless it shall assume the defense of any
proceeding the 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 agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. If the 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 which have been asserted against the indemnified
party in such proceeding by the other parties to such settlement, without the
consent of the indemnified party.
7.4 If the indemnification provided for in this Section 7 is unavailable to
an indemnified party under Section 7.1 or 7.2 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 not only the relative benefits received by the Company
and GMACCM on the one hand and the Underwriters on the other from the offering
of the Certificates but also the relative fault of the Company and GMACCM on the
one hand and of the Underwriters on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative fault of the
Company and GMACCM on the one hand and of any of the Underwriters on the other
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company or
GMACCM or by an Underwriter, and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
7.5 The Company, GMACCM and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 7 were determined by
pro rata allocation or by any other method of allocation which does not take
account of the considerations referred to in Section 7.4 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
15
<PAGE>
pursuant to Section 7.4; which expenses the indemnifying party shall pay as and
when incurred, at the request of the indemnified party, to the extent that the
indemnifying party believes that it will be ultimately obligated to pay such
expenses. In the event that any expenses so paid by the indemnifying party are
subsequently determined to not be required to be borne by the indemnifying party
hereunder, the party which received such payment shall promptly refund the
amount so paid to the party which made such payment. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
7.6 The indemnity and contribution agreements contained in this Section 7
and the representations and warranties of the Company and GMACCM in this
Agreement shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of an Underwriter or any person controlling an Underwriter or by or on behalf of
the Company or GMACCM and their respective directors or officers or any person
controlling the Company or GMACCM and (iii) acceptance of and payment for any of
the Certificates.
8. Termination. This Agreement shall be subject to termination by notice
given to the Company and GMACCM, if the sale of the Certificates provided for
herein is not consummated because of any failure or refusal on the part of the
Company or GMACCM to comply with the terms or to fulfill any of the conditions
of this Agreement, or if for any reason the Company or GMACCM shall be unable to
perform their respective obligations under this Agreement. If the Underwriters
terminate this Agreement in accordance with this Section 8, the Company or
GMACCM will reimburse the Underwriters for all reasonable out-of-pocket expenses
(including reasonable fees and disbursements of counsel) that shall have been
reasonably incurred by the Underwriters in connection with the proposed purchase
and sale of the Certificates.
9. Default by an Underwriter. If any Underwriter shall fail to purchase and
pay for any of the Certificates agreed to be purchased by such Underwriter
hereunder and such failure to purchase shall constitute a default in the
performance of its obligations under this Agreement, the remaining Underwriters
shall be obligated to take up and pay for the Certificates that the defaulting
Underwriter agreed but failed to purchase; provided, however, that in the event
that the initial principal amount of Certificates that the defaulting
Underwriter agreed but failed to purchase shall exceed 10% of the aggregate
principal balance of all of the Certificates set forth in Schedule I hereto, the
remaining Underwriters shall have the right to purchase all, but shall not be
under any obligation to purchase any, of the Certificates, and if such
nondefaulting Underwriters do not purchase all of the Certificates, this
Agreement will terminate without liability to the nondefaulting Underwriters,
the Company or GMACCM. In the event of a default by any Underwriter as set forth
in this Section 9, the Closing Date for the Certificates shall be postponed for
such period, not exceeding seven days, as the nondefaulting Underwriters shall
determine in order that the required changes in the Registration Statement, the
Prospectus 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 to any nondefaulting Underwriter for
damages occasioned by its default hereunder.
16
<PAGE>
10. Certain Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company, GMACCM, the Underwriters or the officers of any of the Company, GMACCM
and the Underwriters set forth in or made pursuant to this Agreement, will
remain in full force and effect, regardless of any investigation, or statement
as to the results thereof, made by or on behalf of any Underwriter or made by or
on behalf of the Company or GMACCM or any of their respective officers,
directors or controlling persons, and will survive delivery of and payment for
the Certificates.
11. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to any of the Underwriters, will be mailed,
delivered or telegraphed and confirmed to the each Representative at the
following address: Deutsche Morgan Grenfell Inc., 31 West 52nd Street, New York,
New York 10019, Attention: Steven Stuart and Lehman Brothers Inc. Three World
Financial Center, 20th Floor, New York, NY 10285, Attention: Paul Hughson; or,
if sent to the Company, will be mailed, delivered or telegraphed and confirmed
to it at 650 Dresher Road, P.O. Box 1015, Horsham, Pennsylvania 19044-8015,
Attention: Structured Finance Manager with a copy to the General Counsel, GMAC
Commercial Mortgage Corporation; or, if sent to GMACCM, will be mailed,
delivered or telegraphed and confirmed to it at 650 Dresher Road, P.O. Box 1015,
Horsham, Pennsylvania 19044-8015, Attention: Structured Finance Manager with a
copy to the General Counsel, GMAC Commercial Mortgage Corporation.
12. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Section 7 hereof, and their
successors and assigns, and no other person will have any right or obligation
hereunder.
13. Applicable Law. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF THE STATE OF NEW YORK.
14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, which taken together
shall constitute one and the same instrument
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<PAGE>
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us a counterpart hereof, whereupon this letter and
your acceptance shall represent a binding agreement among the Company, GMACCM
and the Underwriters.
Very truly yours,
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
By: /s/ Elisa George
-------------------------------------
Name: Elisa George
Title: Vice President
GMAC COMMERCIAL MORTGAGE CORPORATION
By: /s/ Elisa George
-------------------------------------
Name: Elisa George
Title: Senior Vice President
The foregoing Underwriting Agreement
is hereby confirmed and accepted as of
the date first above written.
DEUTSCHE MORGAN GRENFELL INC.
By: /s/Gregory B. Hartch
---------------------------
Name: Gregory B. Hartch
Title: Vice President
By: /s/ Allisson J. Michaels
---------------------------
Name: Allisson J. Michaels
Title: Vice President
LEHMAN BROTHERS INC.
By: /s/ Michael Mazzei
---------------------------
Name: Michael Mazzei
Title: Managing Partner
For itself and the other Underwriters named
in Schedule I to the foregoing Agreement
<PAGE>
SCHEDULE I
As used in this Agreement, the term "Registration Statement" refers to the
registration statement No. 333-37717 filed by GMAC Commercial Mortgage
Securities, Inc. on Form S-3 and declared effective by the Commission.
Title and Description of the Registered Certificates:
Mortgage Pass-Through Certificates, Series 1998-C1, Class X-1, Class A-1, Class
A-2, Class B, Class C, Class D, Class E and Class F
Underwriters: Deutsche Morgan Grenfell Inc. ("DMG"), Lehman Brothers Inc.
("Lehman") and Residential Funding Securities Corporation ("RFSC")
Underwriting Agreement, dated as of April 28, 1998
Cut-off Date: May 1, 1998
Allocations: Subject to the terms and conditions of the Underwriting Agreement,
each Underwriter has agreed to purchase the percentage of each class of
Certificates as set forth below:
Allocation Table
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Underwriter Class X Class A-1 Class A-2 Class B Class C Class D Class E Class F
- ----------- ------- --------- --------- -------- ------- ------- ------- -------
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
DMG ................ 50% 50% 50% 50% 50% 50% 50% 50%
- ------------------------------------------------------------------------------------------------------------------------------------
Lehman ............. 50% 50% 50% 50% 50% 50% 50% 50%
- ------------------------------------------------------------------------------------------------------------------------------------
Total.............. 100% 100% 100% 100% 100% 100% 100% 100%
==== ==== ==== ==== ==== ==== ==== ====
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
I-1
<PAGE>
<TABLE>
<CAPTION>
Initial Class Principal Balance (or in the
Class case of Initial Purchase Moody's/FITCH IBCA
Designation Class X, Class Notional Amount)(1) Pass-Through Rate Price(2) Rating
- ----------- ---------------------------------- ----------------- -------- ------
<S> <C> <C> <C> <C>
X $1,438,000,263 Variable 2.3572 Aaa/AAA
A-1 $333,587,000 6.411% 100.1859 Aaa/AAA
A-2 $687,393,000 6.700% 101.1810 Aaa/AAA
B $28,760,000 6.753%(3) 101.1871 Aaa/AA+
C $64,710,000 6.806%(3) 101.1807 Aa2/AA
D $75,495,000 6.974%(3) 101.1859 A2/A
E $68,305,000 7.153%(4) 99.3306 Baa2/BBB
F $43,140,000 7.153%(4) 94.3337 NA/BBB-
</TABLE>
- ----------
(1) Subject to a variance of plus or minus 5.0%.
(2) Expressed as a percentage of the Class Principal Balance or Class Notional
Amount, as applicable, of the relevant class of Certificates to be
purchased. In addition, as to each such class of the Certificates, the
Underwriters will pay GMAC Commercial Mortgage Securities, Inc. accrued
interest at the initial Pass-Through Rate therefor from the Cut-off Date to
but not including the Closing Date.
(3) Lesser of fixed rate or Weighted Average Net Mortgage Rate.
(4) Weighted Average Net Mortgage Rate.
- --------------------------------------------------------------------------------
Closing Time, Date and Location: 10:00 a.m. New York City time on May 18,1998 at
the offices of Orrick, Herrington & Sutcliffe LLP.
- --------------------------------------------------------------------------------
Issuance and delivery of Registered Certificates: Each class of Registered
Certificates will be issued as one or more Certificates registered in the name
of Cede & Co., as nominee of The Depository Trust Company. Beneficial owners
will hold interests in such Certificates through the book-entry facilities of
The Depository Trust Company in minimum denominations of initial principal
balance or notional amount, as the case may be, of $25,000 in the case of the
Class A-1 and Class A-2 Certificates, Class B, Class C, Class D, Class E and
Class F Certificates and $1,000,000 in the case of the Class X Certificates, and
integral multiples of $1 in excess thereof.
I-2
<PAGE>
EXHIBIT A
[Form of Opinion of Orrick, Herrington & Sutcliffe LLP]
A-1
<PAGE>
EXHIBIT B
[GMAC Commercial Mortgage Corporation Letterhead]
May [__], 1998
To: Persons Listed on Annex A hereto
GMAC Commercial Mortgage Securities, Inc.,
Mortgage Pass-Through Certificates, Series 1998-C1
Ladies and Gentlemen:
I am General Counsel to GMAC Commercial Mortgage Securities, Inc. (the
"Company") and GMAC Commercial Mortgage Corporation ("GMACCM"). In that
capacity, I am familiar with the issuance of certain Mortgage Pass-Through
Certificates, Series 1998-C1 (the "Certificates"), evidencing undivided
interests in a trust fund (the "Trust Fund") consisting primarily of certain
mortgage loans (the "Mortgage Loans"), pursuant to a Pooling and Servicing
Agreement, dated as of May 1, 1998 (the "Pooling and Servicing Agreement"),
among the Company as depositor, GMACCM as master servicer and special servicer,
LaSalle National Bank as trustee (the "Trustee") and ABN AMRO Bank N.V. as
fiscal agent.
Certain of the Mortgage Loans (the "GMACCM Mortgage Loans") were purchased
by the Company from GMACCM pursuant to, and for the consideration described in,
the Mortgage Loan Purchase Agreement, dated as of April 28, 1998 the ("GMACCM
Mortgage Loan Purchase Agreement"), between GMACCM and the Company. Certain of
the Mortgage Loans (the "GACC Mortgage Loans") were purchased by the Company
from German American Capital Corporation ("GACC") pursuant to the Mortgage Loan
Purchase Agreement, dated as of April 28, 1998 (the "GACC Mortgage Loan Purchase
Agreement"), between GACC and the Company.
The Company sold the Class X, Class A-1, Class A-2, Class B, Class C, Class
D, Class E and Class F Certificates (collectively, the "Publicly Offered
Certificates") to Deutsche Morgan Grenfell Inc. and Lehman Brothers Inc. as
representatives (the "Representatives") for themselves and the other
underwriters (the "Underwriters") named in the Underwriting Agreement, dated as
of April 28, 1998 (the "Underwriting Agreement"), among the Company, GMACCM and
the Representatives, and sold the Class G, Class H, Class J, Class K, Class L,
Class M, Class N, Class R-I, Class R-II and R-III Certificates (collectively,
the "Privately Offered Certificates") to Deutsche Morgan Grenfell Inc. and
Lehman Brothers Inc. as initial purchasers (the "Initial Purchasers") pursuant
to the Certificate Purchase Agreement, dated as of April 28, 1998 (the
"Certificate Purchase Agreement"), among the Company, GMACCM and the Initial
Purchasers (the Certificate Purchase Agreement, the Underwriting Agreement, the
GMACCM Mortgage Loan Purchase Agreement, the GACC Mortgage Loan Purchase
Agreement and the Pooling and Servicing Agreement, collectively, the
"Agreements"). Capitalized terms not defined herein have
B-1
<PAGE>
the meanings set forth in the Agreements.
In connection with rendering this opinion letter, I have examined the
Agreements and such other records and other documents as I have deemed
necessary. I have further assumed that there is not and will not be any other
agreement that materially supplements or otherwise modifies the agreements
expressed in the Agreements. As to matters of fact, I have examined and relied
upon representations of parties contained in the Agreements and, where I have
deemed appropriate, representations and certifications of officers of the
Company, GMACCM, the Trustee, other transaction participants or public
officials. I have assumed the authenticity of all documents submitted to me as
originals, the genuineness of all signatures other than officers of the Company
and GMACCM, the legal capacity of natural persons other than officers of the
Company and GMACCM and the conformity to the originals of all documents
submitted to me as copies. I have assumed that all parties, except for the
Company and GMACCM, had the corporate power and authority to enter into and
perform all obligations thereunder. As to such parties, I also have assumed the
due authorization by all requisite corporate action, the due execution and
delivery and the enforceability of such documents. I have further assumed the
conformity of the Mortgage Loans and related documents to the requirements of
the Agreements.
In rendering this opinion letter, I do not express any opinion concerning
any law other than the law of the Commonwealth of Pennsylvania, the General
Corporation Law of the State of Delaware and the federal law of the United
States, and I do not express any opinion concerning the application of the
"doing business" laws or the securities laws of any jurisdiction other than the
federal securities laws of the United States. To the extent that any of the
matters upon which I am opining herein are governed by laws ("Other Laws") other
than the laws identified in the preceding sentence, I have assumed with your
permission and without independent verification or investigation as to the
reasonableness of such assumption, that such Other Laws and judicial
interpretation thereof do not vary in any respect material to this opinion from
the corresponding laws of the Commonwealth of Pennsylvania and judicial
interpretations thereof. I do not express any opinion on any issue not expressly
addressed below.
Based upon the foregoing, I am of the opinion that:
1. The Company is duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, and has
the requisite power and authority, corporate or other, to own its properties and
conduct its business, as presently conducted by it, and to enter into and
perform its obligations under the Agreements.
2. GMACCM is duly incorporated and is validly existing as a corporation in
good standing under the laws of the State of California, and has the requisite
power and authority, corporate or other, to own its properties and conduct its
business, as presently conducted by it, and to enter into and perform its
obligations under the Agreements.
3. Each of the Agreements has been duly and validly authorized, executed
and delivered by the Company and GMACCM and, upon due authorization, execution
and delivery by
B-2
<PAGE>
the other parties thereto, will constitute the valid, legal and binding
agreements of GMACCM and the Company, enforceable against GMACCM and the Company
in accordance with their terms, except as enforceability may be limited by (i)
bankruptcy, insolvency, liquidation, receivership, moratorium, reorganization or
other similar laws affecting the rights of creditors, (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 the Agreements which purport to provide indemnification with
respect to securities law violations.
4. No consent, approval, authorization or order of the Commonwealth of
Pennsylvania, State of Delaware, State of California or federal court or
governmental agency or body is required for the consummation by GMACCM or the
Company of the transactions contemplated by the terms of the Agreements, except
for those consents, approvals, authorizations or orders which previously have
been obtained.
5. Neither the sale, issuance and delivery of the Certificates as provided
in the Agreements nor the consummation of any other of the transactions
contemplated by, or the fulfillment by the Company or GMACCM of any other of the
terms of, the Agreements, will result in a breach of any term or provision of
the charter or bylaws of GMACCM or the Company or any Commonwealth of
Pennsylvania, State of Delaware, State of California or federal statute or
regulation or conflict with, result in a breach, violation or acceleration of or
constitute a default under the terms of any indenture or other material
agreement or instrument to which GMACCM or the Company is a party or by which it
is bound or any order or regulation of any Commonwealth of Pennsylvania or
federal court, regulatory body, administrative agency or governmental body
having jurisdiction over GMACCM or the Company.
This opinion letter is rendered for the sole benefit of each addressee
hereof, and no other person or entity, except Orrick, Herrington & Sutcliffe
LLP, is entitled to rely hereon without my prior written consent. Copies of this
opinion letter may not be furnished to any other person or entity, nor may any
portion of this opinion letter be quoted, circulated or referred to in any other
document without my prior written consent.
Very truly yours,
Maria Corpora-Buck
General Counsel
B-3
<PAGE>
Annex A
GMAC Commercial Mortgage Securities, Inc.
GMAC Commercial Mortgage Corporation
Deutsche Morgan Grenfell Inc.
Lehman Brothers Inc.
Residential Funding Securities Corporation
LaSalle National Bank
ABN AMRO Bank N.V.
Moody's Investors Service, Inc.
FITCH IBCA INC.
<PAGE>
EXHIBIT C
Excluded Information of Prospectus Supplement
(All circled text and tables are excluded)
C-1
<PAGE>
EXHIBIT D
Underwriter Information
(All circled text and tables are excluded)
D-1
<PAGE>
EXHIBIT E
May [__], 1998
GMAC Commercial Mortgage Securities, Inc.
GMAC Commercial Mortgage Corporation
650 Dresher Road
Horsham, Pennsylvania 19044
Re: GMAC Commercial Mortgage Securities, Inc., Mortgage
Pass-Through Certificates, Series 1998-C1
Pursuant to Section 4.3 of the Underwriting Agreement, dated April 28, 1998
(the "Underwriting Agreement"), among GMAC Commercial Mortgage Securities, Inc.,
GMAC Commercial Mortgage Corporation and, Deutsche Morgan Grenfell Inc. and
Lehman Brothers Inc., each as representative on behalf of itself and the
underwriters set forth therein (the "Underwriters") relating to the Certificates
referenced above, the undersigned does hereby certify that:
(a) The prepayment assumption used in pricing the Certificates was [__]%
CPR.
(b) With respect to each class of Certificates, set forth below is (i), the
first price at which 10% of the aggregate actual or notional, as the case may
be, principal balance of each such class of Certificates was sold to the public
at a single price, if applicable, or (ii) if more than 10% of a class of
Certificates have been sold to the public but no single price is paid for at
least 10% of the aggregate actual or notional, as the case may be, principal
balance of such class of Certificates, then the weighted average price at which
the Certificates of such class were sold expressed as a percentage of the actual
or notional, as the case may be, principal balance of such class of
Certificates, or (iii) if less than 10% of the aggregate actual or notional, as
the case may be, principal balance of a class of Certificates has been sold to
the public, the purchase price for each such class of Certificates paid by the
Underwriters expressed as a percentage of the actual or notional, as the case
may be, principal balance of such class of Certificates calculated by: (1)
estimating the fair market value of each such class of Certificates as of May
18, 1998; (2) adding such estimated fair market value to the aggregate purchase
price of each class of Certificates described in clause (i) or (ii) above; (3)
dividing each of the fair market values determined in clause (1) by the sum
obtained in clause (2); (4) multiplying the quotient obtained for each class of
Certificates in clause (3) by the purchase price paid by the Purchaser for all
the Certificates; and (5) for each class of Certificates, dividing the product
obtained from such class of Certificates in clause (4) by the original actual or
notional, as the case may be, principal balance of such class of Certificates:
Class X: __________________
Class A-1: ________________
Class A-2: ________________
Class B: __________________
E-1
<PAGE>
Class C: __________________
Class D: __________________
Class E: __________________
Class F: __________________
* less than 10% has been sold to the public
The prices set forth above do not include accrued interest with respect to
periods before closing.
DEUTSCHE MORGAN GRENFELL INC.
By:
-------------------------------------
Name:
Title:
By:
-------------------------------------
Name:
Title:
LEHMAN BROTHERS INC.
By:
-------------------------------------
Name:
Title:
For itself and the other Underwriters
named in Schedule I to the Underwriting
Agreement
E-2
EXHIBIT 4.1
EXECUTION COPY
a GMAC COMMERCIAL MORTGAGE SECURITIES, INC.,
Depositor,
GMAC COMMERCIAL MORTGAGE CORPORATION,
Master Servicer,
GMAC COMMERCIAL MORTGAGE CORPORATION,
Special Servicer,
LASALLE NATIONAL BANK,
Trustee
and
ABN AMRO BANK N.V.,
Fiscal Agent
---------------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of May 1, 1998
---------------------------------------------
$1,438,000,263
Mortgage Pass-Through Certificates
Series 1998-C1
<PAGE>
TABLE OF CONTENTS
Section Page
- ------- ----
ARTICLE I
DEFINITIONS
SECTION 1.01 Defined Terms ................................................. 4
Accrued Certificate Interest ..................................... 4
Acquisition Date ................................................. 4
Additional Trust Fund Expense .................................... 4
Adjustable Rate Mortgage Loan .................................... 4
Adjustment Date .................................................. 4
Advance .......................................................... 4
Advance Interest ................................................. 5
Adverse REMIC Event .............................................. 5
Affiliate ........................................................ 5
Agreement ........................................................ 5
Anticipated Repayment Date ....................................... 5
Applicable State Law ............................................. 5
Appraisal ........................................................ 5
Appraisal Reduction Amount ....................................... 5
Appraised Value .................................................. 6
ARD Loan ......................................................... 6
Assignment of Leases ............................................. 6
Assumed Monthly Payment .......................................... 6
Available Distribution Amount .................................... 7
Balloon Mortgage Loan ............................................ 7
Balloon Payment .................................................. 7
Balloon Payment Interest Excess .................................. 7
Balloon Payment Interest Shortfall ............................... 8
Bankruptcy Code .................................................. 8
Breach ........................................................... 8
Book-Entry Certificate ........................................... 8
Business Day ..................................................... 8
Cash Collateral Account .......................................... 8
Cash Collateral Account Agreement ................................ 8
CERCLA ........................................................... 8
Certificate ...................................................... 9
Certificate Account .............................................. 9
Certificate Factor ............................................... 9
Certificateholder ................................................ 9
Holder ........................................................... 9
Certificate Notional Amount ...................................... 9
Certificate Owner ................................................ 9
i
<PAGE>
Certificate Principal Balance ................................... 10
Certificate Register ............................................ 10
Certificate Registrar ........................................... 10
Class ........................................................... 10
Class A Certificate ............................................. 10
Class A-1 Certificate ........................................... 10
Class A-2 Certificate ........................................... 10
Class B Certificate ............................................. 10
Class C Certificate ............................................. 10
Class D Certificate ............................................. 10
Class E Certificate ............................................. 10
Class F Certificate ............................................. 10
Class G Certificate ............................................. 11
Class H Certificate ............................................. 11
Class J Certificate ............................................. 11
Class K Certificate ............................................. 11
Class L Certificate ............................................. 11
Class M Certificate ............................................. 11
Class N Certificate ............................................. 11
Class LA-1 Component ............................................ 11
Class LA-2 Component ............................................ 11
Class LB Component .............................................. 11
Class LC Component .............................................. 11
Class LD Component .............................................. 11
Class LE Component .............................................. 12
Class LF Component .............................................. 12
Class LG Component .............................................. 12
Class LH Component .............................................. 12
Class LJ Component .............................................. 12
Class LK Component .............................................. 12
Class LL Component .............................................. 12
Class LM Component .............................................. 12
Class LN Component .............................................. 12
Class Notional Amount ........................................... 12
Class Principal Balance ......................................... 12
Class R-I Certificate ........................................... 13
Class R-II Certificate .......................................... 13
Class R-III Certificate ......................................... 13
Class R-I Distribution Amount ................................... 13
Class R-II Distribution Amount .................................. 13
Class X Certificate ............................................. 13
Class X Component ............................................... 13
Closing Date .................................................... 13
Code ............................................................ 13
Collection Period ............................................... 13
Collection Report ............................................... 14
ii
<PAGE>
Commission ...................................................... 14
Compensating Interest Payments .................................. 14
Component Rate .................................................. 14
Controlling Class ............................................... 14
Corporate Trust Office .......................................... 14
Corrected Mortgage Loan ......................................... 14
CPR ............................................................. 14
Credit File ..................................................... 14
Cross-Collateralized Mortgage Loans ............................. 15
Current Principal Distribution Amount ........................... 15
Custodian ....................................................... 16
Cut-off Date .................................................... 16
Cut-off Date Principal Balance .................................. 16
Debt Service Coverage Ratio ..................................... 16
Debt Service Reduction .......................................... 16
Defaulted Mortgage Loan ......................................... 16
Default Interest ................................................ 16
Defeasance Collateral ........................................... 16
Defeasance Loan ................................................. 16
Defeasance Option ............................................... 16
Defect .......................................................... 17
Deficient Valuation ............................................. 17
Definitive Certificate .......................................... 17
Deleted Mortgage Loan ........................................... 17
Delinquency Advance ............................................. 17
Delinquency Advance Date ........................................ 17
Delinquent Loan Status Report ................................... 17
Depositor ....................................................... 17
Depository ...................................................... 17
Depository Participant .......................................... 17
Determination Date .............................................. 18
Directly Operate ................................................ 18
Discount Rate ................................................... 18
Discount Rate Fraction .......................................... 18
Distributable Certificate Interest .............................. 18
Distribution Account ............................................ 19
Distribution Date ............................................... 19
Distribution Date Statement ..................................... 19
Due Date ........................................................ 19
Eligible Account ................................................ 19
Emergency Advance ............................................... 20
Environmental Assessment ........................................ 20
ERISA ........................................................... 20
Escrow Payment .................................................. 20
Event of Default ................................................ 20
Excess Interest ................................................. 20
iii
<PAGE>
Excess Rate ..................................................... 20
Exchange Act .................................................... 20
FDIC ............................................................ 20
FHLMC ........................................................... 20
Final Distribution Date ......................................... 20
Final Recovery Determination .................................... 20
Fiscal Agent .................................................... 21
Fiscal Agent Termination Event .................................. 21
FITCH IBCA ...................................................... 21
Fixed Rate Mortgage Loan ........................................ 21
FNMA ............................................................ 21
GMACCM .......................................................... 21
GACC ............................................................ 21
Gross Margin .................................................... 21
Ground Lease .................................................... 21
Hazardous Materials ............................................. 21
Historical Loan Modification Report ............................. 22
Historical Loss Report .......................................... 22
Independent ..................................................... 22
Independent Contractor .......................................... 22
Index ........................................................... 23
Initial Balance ................................................. 23
Initial Class Notional Amount ................................... 23
Initial Class Principal Balance ................................. 23
Insurance Policy ................................................ 23
Insurance Proceeds .............................................. 23
Interest Accrual Period ......................................... 23
Interest Rate Adjustment Date ................................... 23
Interest Reserve Account ........................................ 24
Interest Reserve Loans .......................................... 24
Interested Person ............................................... 24
Issue Price ..................................................... 24
Late Collections ................................................ 24
Liquidation Event ............................................... 24
Liquidation Expenses ............................................ 25
Liquidation Fee ................................................. 25
Liquidation Fee Rate ............................................ 25
Liquidation Proceeds ............................................ 25
Loan-to-Value Ratio ............................................. 25
Lock-Box Account ................................................ 25
Lock-Box Agreement .............................................. 26
Loss Reimbursement Amount ....................................... 26
MAI ............................................................. 26
Majority Certificateholder ...................................... 26
Master Servicer ................................................. 26
Master Servicer Remittance Date ................................. 26
iv
<PAGE>
Master Servicer Remittance Report ............................... 26
Master Servicing Fee ............................................ 27
Master Servicing Fee Rate ....................................... 27
Maturity Date ................................................... 27
Modified Mortgage Loan .......................................... 27
Monthly Payment ................................................. 27
Moody's ......................................................... 28
Mortgage ........................................................ 28
Mortgage File ................................................... 28
Mortgage Loan ................................................... 30
Mortgage Loan Accrual Period .................................... 30
Mortgage Loan Accrued Interest .................................. 30
Mortgage Loan Purchase Agreement ................................ 31
Mortgage Loan Schedule .......................................... 31
Mortgage Loan Seller ............................................ 31
Mortgage Note ................................................... 31
Mortgage Pool ................................................... 31
Mortgage Rate ................................................... 32
Mortgaged Property .............................................. 32
Mortgagor ....................................................... 32
Net Aggregate Prepayment Interest Shortfall ..................... 32
Net Default Interest ............................................ 32
Net Investment Earnings ......................................... 32
Net Investment Loss ............................................. 32
Net Mortgage Rate ............................................... 33
Net Operating Income ............................................ 33
Nonrecoverable Advance .......................................... 33
Nonrecoverable Delinquency Advance .............................. 33
Nonrecoverable Servicing Advance ................................ 34
Non-Registered Certificate ...................................... 34
Officer's Certificate ........................................... 34
Opinion of Counsel .............................................. 34
OTS ............................................................. 34
Ownership Interest .............................................. 34
Pass-Through Rate ............................................... 34
Payment Adjustment Date ......................................... 35
Payment Priority ................................................ 35
Penalty Charges ................................................. 35
Percentage Interest ............................................. 35
Permitted Investments ........................................... 35
Permitted Transferee ............................................ 37
Person .......................................................... 38
Plan ............................................................ 38
Preliminary Statement ........................................... 38
Prepayment Assumption ........................................... 38
Prepayment Interest Excess ...................................... 38
v
<PAGE>
Prepayment Interest Shortfall ................................... 38
Prepayment Premium .............................................. 38
Primary Servicing Office ........................................ 39
Principal Allocation Fraction ................................... 39
Principal Balance Certificate ................................... 39
Principal Distribution Amount ................................... 39
Principal Prepayment ............................................ 39
Private Book-Entry Certificate .................................. 39
Proposed Plan ................................................... 39
Prospectus ...................................................... 39
PTCE 95-60 ...................................................... 39
Purchase Price .................................................. 39
Qualified Appraiser ............................................. 40
Qualified Insurer ............................................... 40
Qualifying Substitute Mortgage Loan ............................. 40
Rated Final Distribution Date ................................... 41
Rating Agency ................................................... 41
Rating Agency Confirmation ...................................... 41
Realized Loss ................................................... 41
Record Date ..................................................... 42
Registered Certificates ......................................... 42
Reimbursement Rate .............................................. 42
REMIC ........................................................... 42
REMIC I ......................................................... 42
REMIC I Regular Interest ........................................ 42
REMIC I Remittance Rate ......................................... 42
REMIC II ........................................................ 43
REMIC II Regular Interest ....................................... 43
REMIC II Remittance Rate ........................................ 43
REMIC III ....................................................... 43
REMIC III Certificate ........................................... 43
REMIC III Regular Certificate ................................... 43
REMIC Provisions ................................................ 43
Rents from Real Property ........................................ 44
REO Account ..................................................... 44
REO Acquisition ................................................. 44
REO Disposition ................................................. 44
REO Extension ................................................... 44
REO Loan ........................................................ 45
REO Loan Accrual Period ......................................... 45
REO Property .................................................... 45
REO Revenues .................................................... 45
REO Status Report ............................................... 45
REO Tax ......................................................... 45
Replacement Mortgage Loan ....................................... 46
Request for Release ............................................. 46
vi
<PAGE>
Required Appraisal Loan ......................................... 46
Reserve Account ................................................. 46
Reserve Funds ................................................... 46
Residual Certificate ............................................ 46
Responsible Officer ............................................. 46
Revised Rate .................................................... 46
Securities Act .................................................. 46
Security Agreement .............................................. 46
Senior Certificate .............................................. 46
Senior Living Consultant ........................................ 47
Senior Living Loan .............................................. 47
Senior Living Surety ............................................ 47
Senior Living Surety Bond ....................................... 47
Senior Living Trust Agreement ................................... 47
Senior Living Subrogation Agreement ............................. 47
Servicer Watch List ............................................. 47
Servicing Account ............................................... 47
Servicing Advances .............................................. 47
Servicing Fee Rate .............................................. 48
Servicing Fees .................................................. 48
Servicing Officer ............................................... 48
Servicing Return Date ........................................... 48
Servicing Standard .............................................. 48
Servicing Transfer Event ........................................ 48
Special Servicer ................................................ 48
Special Servicing Fee ........................................... 48
Special Servicing Fee Rate ...................................... 48
Specially Serviced Mortgage Loan ................................ 48
Startup Day ..................................................... 50
Stated Maturity Date ............................................ 50
Stated Principal Balance ........................................ 50
Subordinated Certificate ........................................ 51
Substitution Shortfall Amount ................................... 51
Sub-Servicer .................................................... 51
Sub-Servicing Agreement ......................................... 51
Surety .......................................................... 51
Surety Bond ..................................................... 51
Tax Returns ..................................................... 51
Transfer ........................................................ 51
Transferee ...................................................... 51
Transferor ...................................................... 51
Trust Fund ...................................................... 52
Trustee ......................................................... 52
Trustee Fee ..................................................... 52
Trustee Fee Rate ................................................ 52
UCC ............................................................. 52
vii
<PAGE>
UCC Financing Statement ......................................... 52
Uncertificated Accrued Interest ................................. 52
Uncertificated Distributable Interest ........................... 52
Uncertificated Principal Balance ................................ 53
Underwriter ..................................................... 53
Uninsured Cause ................................................. 53
United States Person ............................................ 53
USPAP ........................................................... 53
Voting Rights ................................................... 53
Weighted Average Net Mortgage Rate .............................. 54
Withheld Amount ................................................. 54
Workout Fee ..................................................... 54
Workout Fee Rate ................................................ 54
SECTION 1.02 Certain Calculations in Respect of the
Mortgage Pool ............................................. 54
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01 Establishment of Trust; Conveyance of Mortgage Loans ........ 56
SECTION 2.02 Acceptance by Trustee ....................................... 58
SECTION 2.03 Mortgage Loan Sellers' Repurchase of Mortgage Loans
for Defects in Mortgage Files and Breaches of
Representations and Warranties .............................. 60
SECTION 2.04 Issuance of Class R-I Certificates; Creation of REMIC I
Regular Interests ........................................... 62
SECTION 2.05 Conveyance of REMIC I Regular Interests; Acceptance
of REMIC II by the Trustee .................................. 62
SECTION 2.06 Issuance of Class R-II Certificates; Creation of REMIC
II Regular Interest ......................................... 62
SECTION 2.07 Conveyance of REMIC II Regular Interests; Acceptance
of REMIC III by Trustee ..................................... 63
SECTION 2.08 Issuance of REMIC III Certificates .......................... 63
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
SECTION 3.01 Servicing and Administration of the Mortgage Loans .......... 64
SECTION 3.02 Collection of Mortgage Loan Payments ........................ 65
SECTION 3.03 Collection of Taxes, Assessments and Similar Items;
Servicing Accounts and Reserve Accounts ..................... 66
viii
<PAGE>
SECTION 3.04 Certificate Account, Distribution Account and Interest
Reserve Account ............................................. 67
SECTION 3.05 Permitted Withdrawals From the Certificate Account, the
Distribution Account and the Interest Reserve Account ....... 71
SECTION 3.06 Investment of Funds in the Certificate Account, the
Interest Reserve Account and the REO Account ................ 74
SECTION 3.07 Maintenance of Insurance Policies; Errors and Omissions
and Fidelity Coverage ....................................... 76
SECTION 3.08 Enforcement of Due-On-Sale Clauses; Assumption
Agreements; Subordinate Financing; Defeasance .............. 79
SECTION 3.09 Realization Upon Defaulted Mortgage Loans .................. 82
SECTION 3.10 Trustee to Cooperate; Release of Mortgage Files ............ 85
SECTION 3.11 Servicing Compensation; Nonrecoverable Servicing
Advances ................................................... 86
SECTION 3.12 Inspections; Collection of Financial Statements ............ 90
SECTION 3.13 Annual Statement as to Compliance .......................... 91
SECTION 3.14 Reports by Independent Public Accountants .................. 92
SECTION 3.15 Access to Certain Information .............................. 92
SECTION 3.16 Title to REO Property; REO Account ......................... 93
SECTION 3.17 Management of REO Property; Independent Contractors ........ 94
SECTION 3.18 Sale of Defaulted Mortgage Loans and REO Properties ........ 97
SECTION 3.19 Additional Obligations of the Master Servicer and the
Special Servicer ........................................... 100
SECTION 3.20 Modifications, Waivers, Amendments and Consents ............ 103
SECTION 3.21 Transfer of Servicing Between Master Servicer and
Special Servicer; Record Keeping ........................... 105
SECTION 3.22 Sub-Servicing Agreements ................................... 106
SECTION 3.23 Designation of Special Servicer by the Majority
Certificateholder of the Controlling Class ................. 108
SECTION 3.24 Lock-Box Accounts and Servicing Accounts ................... 109
SECTION 3.25 Representations and Warranties of the Master Servicer
and the Special Servicer ................................... 109
SECTION 3.26 The Senior Living Loan ..................................... 111
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
AND RELATED MATTERS
SECTION 4.01 Distributions .............................................. 112
SECTION 4.02 Statements to Certificateholders; Certain Reports by the
Master Servicer and the Special Servicer ................... 122
SECTION 4.03 Delinquency Advances ....................................... 130
SECTION 4.04 Allocation of Realized Losses and Additional Trust Fund
Expenses ................................................... 132
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ARTICLE V
THE CERTIFICATES
SECTION 5.01 The Certificates ........................................... 134
SECTION 5.02 Registration of Transfer and Exchange of Certificates ...... 134
SECTION 5.03 Book-Entry Certificates .................................... 141
SECTION 5.04 Mutilated, Destroyed, Lost or Stolen Certificates .......... 142
SECTION 5.05 Persons Deemed Owners ...................................... 143
ARTICLE VI
THE DEPOSITOR, THE MASTER SERVICER AND THE SPECIAL SERVICER
SECTION 6.01 Liability of the Depositor, the Master Servicer and the
Special Servicer ........................................... 144
SECTION 6.02 Merger, Consolidation or Conversion of the Depositor,
the Master Servicer and the Special Servicer; Assignment
of Rights and Delegation of Duties by the Master
Servicer and the Special Servicer .......................... 144
SECTION 6.03 Limitation on Liability of the Depositor, the Master
Servicer, the Special Servicer and Others .................. 145
SECTION 6.04 Depositor, Master Servicer and Special Servicer Not to
Resign ..................................................... 146
SECTION 6.05 Rights of the Depositor in Respect of the Master Servicer
and the Special Servicer ................................... 146
ARTICLE VII
DEFAULT
SECTION 7.01 Events of Default .......................................... 147
SECTION 7.02 Trustee to Act; Appointment of Successor ................... 149
SECTION 7.03 Notification to Certificateholders ......................... 150
SECTION 7.04 Waiver of Events of Default ................................ 151
ARTICLE VIII
CONCERNING THE TRUSTEE AND THE FISCAL AGENT
SECTION 8.01 Duties of Trustee and Fiscal Agent ......................... 152
SECTION 8.02 Certain Matters Affecting the Trustee and the Fiscal
Agent ...................................................... 153
SECTION 8.03 Trustee and Fiscal Agent not Liable for Validity or
Sufficiency of Certificates or Mortgage Loans .............. 155
SECTION 8.04 Trustee and the Fiscal Agent May Own Certificates .......... 155
SECTION 8.05 Fees and Expenses of Trustee; Indemnification of Trustee ... 155
SECTION 8.06 Eligibility Requirements for Trustee and Fiscal Agent ...... 156
x
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SECTION 8.07 Resignation and Removal of the Trustee and the Fiscal
Agent ...................................................... 157
SECTION 8.08 Successor Trustee and the Fiscal Agent ..................... 158
SECTION 8.09 Merger or Consolidation of Trustee and the Fiscal Agent .... 159
SECTION 8.10 Appointment of Co-Trustee or Separate Trustee .............. 159
SECTION 8.11 Appointment of Custodians .................................. 160
SECTION 8.12 Access to Certain Information .............................. 160
SECTION 8.13 Representations and Warranties of the Trustee and the
Fiscal Agent ............................................... 162
SECTION 8.14 Filings with the Securities and Exchange Commission ........ 164
SECTION 8.15 Fiscal Agent Termination Event ............................. 164
SECTION 8.16 Procedure Upon Termination Event ........................... 165
ARTICLE IX
TERMINATION
SECTION 9.01 Termination Upon Repurchase or Liquidation of All
Mortgage Loans ............................................. 166
SECTION 9.02 Additional Termination Requirements ........................ 168
ARTICLE X
ADDITIONAL REMIC PROVISIONS
SECTION 10.01 REMIC Administration ...................................... 169
SECTION 10.02 Depositor, Master Servicer, Special Servicer, Fiscal
Agent, Trustee to Cooperate ............................... 172
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01 Amendment ................................................. 173
SECTION 11.02 Recordation of Agreement; Counterparts .................... 175
SECTION 11.03 Limitation on Rights of Certificateholders ................ 175
SECTION 11.04 GOVERNING LAW ............................................. 176
SECTION 11.05 Notices ................................................... 176
SECTION 11.06 Severability of Provisions ................................ 177
SECTION 11.07 Grant of a Security Interest .............................. 177
SECTION 11.08 Successors and Assigns; Beneficiaries ..................... 178
SECTION 11.09 Article and Section Headings .............................. 178
SECTION 11.10 Notices to the Rating Agencies ............................ 178
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EXHIBITS
Exhibit A-1 ......................................Form of Class X Certificate
Exhibit A-2 ....................................Form of Class A-1 Certificate
Exhibit A-3 ....................................Form of Class A-2 Certificate
Exhibit A-4 ......................................Form of Class B Certificate
Exhibit A-5 ......................................Form of Class C Certificate
Exhibit A-6 ......................................Form of Class D Certificate
Exhibit A-7 ......................................Form of Class E Certificate
Exhibit A-8 ......................................Form of Class F Certificate
Exhibit A-9 ......................................Form of Class G Certificate
Exhibit A-10 .....................................Form of Class H Certificate
Exhibit A-11 .....................................Form of Class J Certificate
Exhibit A-12 .....................................Form of Class K Certificate
Exhibit A-13 .....................................Form of Class L Certificate
Exhibit A-14 .....................................Form of Class M Certificate
Exhibit A-15 .....................................Form of Class N Certificate
Exhibit A-16 ...................................Form of Class R-I Certificate
Exhibit A-17 ..................................Form of Class R-II Certificate
Exhibit A-18 .................................Form of Class R-III Certificate
Exhibit B-1 ...................................Form of Transferor Certificate
Exhibit B-2 ...................................Form of Transferee Certificate
Exhibit B-3 ...................................Form of Transferee Certificate
Exhibit C-1 .........................Form of Transfer Affidavit and Agreement
Exhibit C-2 ...................................Form of Transferor Certificate
Exhibit D ........................................Form of Request for Release
Exhibit E ..................................Form of UCC-1 Financing Statement
Exhibit F .............................Methodology to Normalize Net Operating
Income and Debt Service Coverage
Exhibit G ................................Form of Distribution Date Statement
Exhibit H .....................................Form of Master Servicer Report
Exhibit I ....................................................Certain Reports
Schedules
Schedule I ............................................Mortgage Loan Schedule
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This Pooling and Servicing Agreement (this "Agreement"), is dated and
effective as of May 1, 1998, among GMAC COMMERCIAL MORTGAGE SECURITIES, INC., as
Depositor, GMAC COMMERCIAL MORTGAGE CORPORATION, as Master Servicer, GMAC
COMMERCIAL MORTGAGE CORPORATION, as Special Servicer, LASALLE NATIONAL BANK, as
Trustee and ABN AMRO BANK N.V., as Fiscal Agent.
PRELIMINARY STATEMENT:
The Depositor intends to sell the Certificates, to be issued hereunder in
multiple Classes, which in the aggregate will evidence the entire beneficial
ownership interest in the Trust Fund to be created hereunder, the primary assets
of which will be the Mortgage Loans. The aggregate of the initial Stated
Principal Balances of the Mortgage Loans is approximately $1,438,000,264.
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the Mortgage Loans 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. With respect
to each Mortgage Loan, there shall be a corresponding REMIC I Regular Interest.
The designation for each such REMIC I Regular Interest shall be the loan number
for the related Mortgage Loan set forth on the schedule of Mortgage Loans
attached hereto as Schedule I. The REMIC I Remittance Rate (as defined herein)
and the initial Uncertificated Principal Balance of each such REMIC I Regular
Interest shall be based on the Net Mortgage Rate as of the Cut-off Date and the
Cut-off Date Principal Balance, respectively, for the related Mortgage Loan.
Determined solely for purposes of satisfying Treasury regulation Section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each such REMIC I
Regular Interest shall be the first Distribution Date that follows the Stated
Maturity Date for the related Mortgage Loan. 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 following table irrevocably sets forth the designation, REMIC II
Remittance Rate and the initial Uncertificated Principal Balance for each of the
REMIC II Regular Interests. Determined solely for purposes of satisfying
Treasury regulation Section 1.860G-1(a)(4)(iii), the "latest possible maturity
date" for each REMIC II Regular Interest shall be the first Distribution Date
that is at least two years after the end of the remaining amortization schedule
of the Mortgage Loan that has, as
<PAGE>
of the Closing Date, the longest remaining amortization schedule, irrespective
of its scheduled maturity. None of the REMIC II Regular Interests will be
certificated.
Designation REMIC II Initial Uncertificated
- ----------- Remittance Rate Principal Balance
--------------- -----------------
LA-1 ......................... Variable (*) $333,587,000
LA-2 ......................... Variable (*) 687,393,000
LB ........................... Variable (*) 28,760,000
LC ........................... Variable (*) 64,710,000
LD ........................... Variable (*) 75,495,000
LE ........................... Variable (*) 68,305,000
LF ........................... Variable (*) 43,140,000
LG ........................... Variable (*) 32,355,000
LH ........................... Variable (*) 25,165,000
LJ ........................... Variable (*) 14,380,000
LK ........................... Variable (*) 25,165,000
LL ........................... Variable (*) 14,380,000
LM ........................... Variable (*) 10,785,000
LN ........................... Variable (*) 14,380,263
* Calculated in accordance with the definition of "REMIC II Remittance Rate."
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 represent the sole class of
"residual interests" in REMIC III for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designation, the Pass-Through Rate and initial Class Principal Balance for each
of the Classes of REMIC III Regular Certificates. Determined solely for purposes
of satisfying Treasury regulation section 1.860G-1(a)(4)(iii), the "latest
possible maturity date" for each Class of REMIC III Regular Certificates shall
be the first Distribution Date that is at least two years after the end of the
remaining amortization schedule of the Mortgage Loan that has, as of the Closing
Date, the longest remaining amortization schedule, irrespective of its scheduled
maturity.
Designation Certificate Initial Class
- ----------- Pass-Through Rate Principal Balance
----------------- -----------------
Class X ...................... N/A(1) N/A(2)
Class A-1 .................... 6.411% $333,587,000
Class A-2 .................... 6.700% 687,393,000
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Designation Certificate Initial Class
- ----------- Pass-Through Rate Principal Balance
----------------- -----------------
Class B ...................... 6.753%(3) 28,760,000
Class C ...................... 6.806%(3) 64,710,000
Class D ...................... 6.974%(3) 75,495,000
Class E ...................... 7.153%(4) 68,305,000
Class F ...................... 7.153%(4) 43,140,000
Class G ...................... 7.153%(4) 32,355,000
Class H ...................... 7.153%(4) 25,165,000
Class J ...................... 7.153%(4) 14,380,000
Class K ...................... 6.700%(3) 25,165,000
Class L ...................... 6.700%(3) 14,380,000
Class M ...................... 6.700%(3) 10,785,000
Class N ...................... 6.700%(3) 14,380,263
(1) The Pass-Through Rate for the Class X Certificates as described herein.
(2) The Class X Certificate will have an original Notional Amount of
$1,438,000,263. The Class X Certificates will not have a Certificate
Principal Balance and will not be entitled to any distribution of
certificate principal.
(3) Lesser of the indicated Fixed Rate or the Weighted Average Net Mortgage
Rate.
(4) Initial Pass-Through Rate. The Pass-Through Rate will be the Weighted
Average Net Mortgage Rate.
Capitalized terms used in this Preliminary Statement are defined in Article
I hereof.
In consideration of the mutual agreements herein contained, the Depositor,
the Master Servicer, the Special Servicer, the Trustee and the Fiscal Agent
agree as follows:
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<PAGE>
ARTICLE I
DEFINITIONS
SECTION 1.01 Defined Terms.
Whenever used in this Agreement, including in the Preliminary Statement,
the following words and phrases, unless the context otherwise requires, shall
have the meanings specified in this Article.
"Accrued Certificate Interest": With respect to any Class of REMIC III
Regular Certificates for any Distribution Date, one month's interest (calculated
on the basis of a 360-day year consisting of twelve 30-day months) at the
Pass-Through Rate applicable to such Class of Certificates for such Distribution
Date, accrued on the Class Principal Balance or Class Notional Amount, as the
case may be, of such Class of Certificates outstanding immediately prior to such
Distribution Date. The Accrued Certificate Interest in respect of any Class of
REMIC III Regular Certificates for any Distribution Date shall be deemed to have
accrued during the applicable Interest Accrual Period.
"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 Regulation Section 1.856-6(b)(1), which is the first day
on which the Trust Fund is treated as the owner of such REO Property for federal
income tax purposes.
"Additional Trust Fund Expense": Any unanticipated expense within the
meaning of Treasury Regulation Section 1.860G-1(b)(3)(iii) experienced with
respect to the Trust Fund and not otherwise included in the calculation of a
Realized Loss, that would result in the REMIC III Regular Certificateholders'
receiving less than the full amount of principal and/or interest to which they
are entitled on any Distribution Date.
"Adjustable Rate Mortgage Loan": A Mortgage Loan as to which the related
Mortgage Note provides, as of the Closing Date, for periodic adjustments to the
Mortgage Rate thereon based on changes in the related Index.
"Adjustment Date": With respect to each Adjustable Rate Mortgage Loan, any
date on which the Mortgage Rate thereon is subject to adjustment pursuant to the
related Mortgage Note. The first Adjustment Date following the Cut-off Date as
to each Adjustable Rate Mortgage Loan is set forth in the Mortgage Loan
Schedule. Successive Adjustment Dates will occur as to each Adjustable Rate
Mortgage Loan with the frequency specified in the Mortgage Loan Schedule.
"Advance": Any Delinquency Advance or Servicing Advance.
4
<PAGE>
"Advance Interest": Interest accrued on any Advance at the Reimbursement
Rate and payable to the Master Servicer, the Special Servicer or the Trustee, as
the case may be, all in accordance with Section 3.11(f) or Section 4.03(d), as
applicable.
"Adverse REMIC Event": As defined in Section 10.01(f).
"Affiliate": With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agreement": This Pooling and Servicing Agreement and all amendments hereof
and supplements hereto.
"Anticipated Repayment Date": With respect to any ARD Loan, designated as
such in the Mortgage Loan Schedule, the date upon which such ARD Loan starts to
accrue interest at its Revised Rate.
"Applicable State Law": For purposes of Article X, the Applicable State Law
shall be (a) the laws of the State and City of New York, (b) the laws of the
states in which the Corporate Trust Office of the Trustee and the Primary
Servicing Offices of the Master Servicer and the Special Servicer are located,
(c) other state or local law as to which the Trustee as the REMIC administrator
has actual knowledge of applicability and (d) such other state or local law
whose applicability shall have been brought to the attention of the Trustee as
REMIC administrator by either (i) an opinion of counsel delivered to it, or (ii)
written notice from the appropriate taxing authority as to the applicability of
such state law.
"Appraisal": With respect to any Mortgaged Property or REO Property as to
which an appraisal is required or permitted to be performed pursuant to the
terms of this Agreement, either: (i) a narrative appraisal complying with USPAP
conducted by a Qualified Appraiser in the case of Mortgage Loans and REO Loans
with a Stated Principal Balance as of the date of such appraisal of greater than
$1,000,000; or (ii) a limited appraisal and a summary report of the "market
value" of the Mortgaged Property conducted by a Qualified Appraiser in the case
of Mortgage Loans and REO Loans with a Stated Principal Balance as of the date
of such appraisal of $1,000,000 or less.
"Appraisal Reduction Amount": With respect to any Required Appraisal Loan,
an amount (as calculated on the Determination Date immediately succeeding the
date on which the most recent relevant Appraisal was obtained by the Master
Servicer or the Special Servicer, as the case may be, pursuant to this
Agreement) equal to the excess, if any, of (a) the sum of (i) the Stated
Principal Balance of such Required Appraisal Loan, (ii) to the extent not
previously
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<PAGE>
advanced by or on behalf of the Master Servicer, the Trustee or the Fiscal
Agent, all accrued and unpaid interest on such Required Appraisal Loan through
the most recent Due Date prior to such Determination Date at a per annum rate
equal to the related Mortgage Rate, (iii) all related unreimbursed Advances made
by or on behalf of the Master Servicer, the Special Servicer, the Trustee or the
Fiscal Agent in respect of such Required Appraisal Loan, together with all
unpaid Advance Interest accrued on such Advances, and (iv) all currently due but
unpaid real estate taxes and assessments, insurance premiums and, if applicable,
ground rents in respect of the related Mortgaged Property or REO Property, net
of any Escrow Payments or other reserves held by the Master Servicer or the
Special Servicer with respect to any such item, over (b) 90% of an amount equal
to (i) the Appraised Value of the related Mortgaged Property or REO Property, as
applicable, as determined by such Appraisal referred to in the parenthetical
above, net of (ii) the amount of any liens on such property (not accounted for
in clause (a)(iv) of this definition) that are prior to the lien of the Required
Appraisal Loan.
"Appraised Value": As of any date of determination, the appraised value of
a Mortgaged Property based upon the most recent Appraisal obtained pursuant to
this Agreement.
"ARD Loan": Any Mortgage Loan that is designated as such in the Mortgage
Loan Schedule.
"Assignment of Leases": With respect to any Mortgaged Property, any
assignment of leases, rents, security deposits and profits or similar instrument
executed by the Mortgagor, assigning to the mortgagee all of the income, rents
and profits derived from the ownership, operation, leasing or disposition of all
or a portion of such Mortgaged Property, in the form which was duly executed,
acknowledged and delivered, as amended, modified, renewed or extended through
the date hereof and from time to time hereafter.
"Assumed Monthly 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 the end of the Collection Period in which such Stated Maturity Date
occurs) and for any subsequent Due Date therefor as of which such Mortgage Loan
remains outstanding and part of the Trust Fund, if no Monthly Payment (other
than the related delinquent Balloon Payment) is due for such Due Date, the
scheduled monthly payment of principal and/or interest deemed to be due in
respect thereof for the Stated Maturity Date and each such subsequent Due Date
equal to the Monthly Payment that would have been due in respect of such
Mortgage Loan on such Due Date if it had been required to continue to accrue
interest in accordance with its terms, and to pay principal in accordance with
the amortization schedule (if any), in effect immediately prior to, and without
regard to the occurrence of, its most recent scheduled 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 Monthly Payment (or, in the case of a Balloon Mortgage Loan
described in the preceding sentence of this definition, the Assumed Monthly
Payment) that was
6
<PAGE>
due in respect of the related Mortgage Loan for the last Due Date prior to its
becoming an REO Loan.
"Available Distribution Amount": With respect to any Distribution Date, an
amount equal to (a) the sum of (i) the aggregate amount relating to the Trust
Fund on deposit in the Certificate Account and the Distribution Account as of
the close of business on the related Determination Date, (ii) the aggregate
amount of any Delinquency Advances made by the Master Servicer, Trustee or
Fiscal Agent for such Distribution Date pursuant to Section 4.03, (iii) the
aggregate of any Compensating Interest Payments made by the Master Servicer for
such Distribution Date pursuant to Section 3.19, (iv) the aggregate amount of
any Excess Interest received for such Distribution Date, (v) in the case of the
Final Distribution Date, the aggregate of any Liquidation Proceeds paid by the
Master Servicer or the Depositor in connection with a purchase of all the
Mortgage Loans and any REO Properties pursuant to Section 9.01 and (vi) with
respect to the Distribution Date occurring in March of each calendar year, the
Withheld Amounts with respect to the Interest Reserve Loans deposited in the
Interest Reserve Account by the Trustee in accordance with Section 3.04(c), net
of (b) the aggregate portion of the amount described in clause (a) hereof that
represents one or more of the following: (i) Monthly Payments paid by the
Mortgagors 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 Certificate Account pursuant to clauses (ii) - (xvii), inclusive, of Section
3.05(a), (iii) any amounts payable or reimbursable to any Person from the
Distribution Account pursuant to clauses (iii) - (vi), inclusive, of Section
3.05(b), (iv) Prepayment Premiums, (v) any amounts deposited in the Certificate
Account or the Distribution Account, as the case may be, in error, and (vi) with
respect to the Distribution Date occurring in (A) January of each calendar year
that is not a leap year and (B) February of each calendar year, the Withheld
Amounts with respect to the Interest Reserve Loans deposited in the Interest
Reserve Account by the Trustee in accordance with Section 3.04(c).
Notwithstanding the investment of funds held in the Certificate Account pursuant
to Section 3.06, for purposes of calculating the Available Distribution Amount,
the amounts so invested shall be deemed to remain on deposit in such account.
"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 Maturity Date.
"Balloon Payment": With respect to any Balloon Mortgage Loan as of any date
of determination, the Monthly Payment payable on the Maturity Date of such
Mortgage Loan.
"Balloon Payment Interest Excess": With respect to any Balloon Mortgage
Loan as to which the Stated Maturity Date occurs after the first day of, but on
or before the Determination Date in, any calendar month, the amount of interest
(net of related Master Servicing Fees) accrued on such Mortgage Loan from the
beginning of such month to, but not including, such Stated Maturity Date, to the
extent such interest is actually paid by the related
7
<PAGE>
Mortgagor in connection with the payment of the related Balloon Payment during
the Collection Period in which such Stated Maturity Date occurs.
"Balloon Payment Interest Shortfall": With respect to any Balloon Mortgage
Loan as to which the Stated Maturity Date occurs after the Determination Date in
any calendar month, the amount of interest that would have accrued on such
Mortgage Loan at the related Net Mortgage Rate from such Stated Maturity Date
through the end of such calendar month, to the extent not paid by the related
Mortgagor.
"Bankruptcy Code": The federal Bankruptcy Code, as amended from time to
time (Title 11 of the United States Code).
"Breach": As defined in Section 2.03(a).
"Book-Entry Certificate": Any Certificate registered in the name of the
Depository or its nominee.
"Business Day": Any day other than a Saturday, a Sunday or a day on which
banking institutions in New York, New York, and the cities in which the Primary
Servicing Offices of the Master Servicer and the Special Servicer and the city
in which the Corporate Trust Office of the Trustee is located, are authorized or
obligated by law or executive order to remain closed.
"Cash Collateral Account": With respect to any Mortgage Loan that has a
Lock-Box Account, any account or accounts created pursuant to the related
Mortgage Loan, Cash Collateral Account Agreement or other loan document, into
which account or accounts the LockBox Account monies are swept on a regular
basis for the benefit of the Trustee as successor to the Mortgage Loan Seller's
interest in the Mortgage Loans. Any Cash Collateral Account shall be
beneficially owned for federal income tax purposes by the Person who is entitled
to receive all reinvestment income or gain thereon in accordance with the terms
and provisions of the related Mortgage Loan and Section 3.06, which Person shall
be taxed on all reinvestment income or gain thereon. The Master Servicer shall
be permitted to make withdrawals therefrom solely for deposit into the
Certificate Account. To the extent not inconsistent with the terms of the
related Mortgage Loan, each such Cash Collateral Account shall be an Eligible
Account.
"Cash Collateral Account Agreement": With respect to any Mortgage Loan, the
cash collateral account agreement, if any, between the originator of such
Mortgage Loan and the related Mortgagor, pursuant to which the related Cash
Collateral Account, if any, may have been established.
"CERCLA": The Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
8
<PAGE>
"Certificate": Any one of the Depositor's Mortgage Pass-Through
Certificates, Series 1998-C1, as executed by the Trustee and authenticated and
delivered hereunder by the Certificate Registrar.
"Certificate Account": The custodial account or accounts created and
maintained pursuant to Section 3.04(a) in the name of a depository institution,
as custodian for the holders of the Certificates, for the holders of certain
other interests in mortgage loans serviced or sold by the Master Servicer and
for the Master Servicer, into which the amounts set forth in Section 3.04(a)
shall be deposited directly. Any such account or accounts shall be an Eligible
Account.
"Certificate Factor": With respect to any Class of REMIC III Regular
Certificates, as of any date of determination, a fraction, expressed as a
decimal carried to eight places, the numerator of which is the then related
Class Principal Balance or the Class Notional Amount, as the case may be, and
the denominator of which is the related Initial Class Principal Balance or the
Initial Class Notional Amount, as the case may be.
"Certificateholder" or "Holder": The Person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purposes of
giving any consent, approval or waiver pursuant to this Agreement, any
Certificate registered in the name of the Master Servicer, the Special Servicer,
the Trustee, the Fiscal Agent, the Depositor or any Affiliate of either 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 has
been obtained, except as otherwise provided in Sections 7.04 and 11.01. The
Trustee shall be entitled to request and rely upon a certificate of the Master
Servicer, the Special Servicer or the Depositor 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.
"Certificate Notional Amount": With respect to any Class X Certificate, as
of any date of determination, the then notional principal amount on which such
Certificate accrues interest equal to the product of (a) the Percentage Interest
evidenced by such Certificate, multiplied by (b) the then Class Notional Amount
of the Class X 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.
9
<PAGE>
"Certificate Principal Balance": With respect to any Principal Balance
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 registrar appointed pursuant to Section 5.02.
"Class": Collectively, all of the Certificates bearing the same
alphabetical and, if applicable, numerical class designation.
"Class A Certificate": Any one of the Class A-1 or 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-2
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class A-2 Certificate": Any one of the Certificates with a "Class A-2"
designation on the face thereof, substantially in the form of Exhibit A-3
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class B Certificate": Any one of the Certificates with a "Class B"
designation on the face thereof, substantially in the form of Exhibit A-4
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class C Certificate": Any one of the Certificates with a "Class C"
designation on the face thereof, substantially in the form of Exhibit A-5
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class D Certificate": Any one of the Certificates with a "Class D"
designation on the face thereof, substantially in the form of Exhibit A-6
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class E Certificate": Any one of the Certificates with a "Class E"
designation on the face thereof, substantially in the form of Exhibit A-7
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class F Certificate": Any one of the Certificates with a "Class F"
designation on the face thereof, substantially in the form of Exhibit A-8
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
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"Class G Certificate": Any one of the Certificates with a "Class G"
designation on the face thereof, substantially in the form of Exhibit A-9
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class H Certificate": Any one of the Certificates with a "Class H"
designation on the face thereof, substantially in the form of Exhibit A-10
attached hereto, and evidencing a "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-11
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class K Certificate": Any one of the Certificates with a "Class K"
designation on the face thereof, substantially in the form of Exhibit A-12
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class L Certificate": Any one of the Certificates with a "Class L"
designation on the face thereof, substantially in the form of Exhibit A-13
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class M Certificate": Any one of the Certificates with a "Class M"
designation on the face thereof, substantially in the form of Exhibit A-14
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class N Certificate": Any one of the Certificates with a "Class N"
designation on the face thereof, substantially in the form of Exhibit A-15
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class LA-1 Component": The amount, if any, by which the Weighted Average
Net Mortgage Rate for such Distribution Date exceeds the Class A-1 Pass-Through
Rate.
"Class LA-2 Component": The amount, if any, by which the Weighted Average
Net Mortgage Rate for such Distribution Date exceeds the Class A-2 Pass-Through
Rate.
"Class LB Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class B Pass-Through Rate.
"Class LC Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class C Pass-Through Rate.
"Class LD Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class D Pass-Through Rate
for such Distribution Date.
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"Class LE Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class E Pass-Through Rate
for such Distribution Date.
"Class LF Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class F Pass-Through Rate
for such Distribution Date.
"Class LG Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class G Pass-Through Rate
for such Distribution Date.
"Class LH Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class H Pass-Through Rate
for such Distribution Date.
"Class LJ Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class J Pass-Through Rate
for such Distribution Date.
"Class LK Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class K Pass-Through Rate
for such Distribution Date.
"Class LL Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class L Pass-Through Rate
for such Distribution Date.
"Class LM Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class M Pass-Through Rate
for such Distribution Date.
"Class LN Component": The amount, if any, by which the Weighted Average Net
Mortgage Rate for such Distribution Date exceeds the Class N Pass-Through Rate
for such Distribution Date.
"Class Notional Amount": The aggregate notional principal amount on which
the Class X Certificates accrue interest from time to time which, as of any date
of determination, is equal to the then aggregate of the Uncertificated Principal
Balances of REMIC II Regular Interests LA-1, LA-2, LB, LC, LD, LE, LF, LG, LH,
LJ, LK, LL, LM and LN.
"Class Principal Balance": The aggregate principal amount of any Class of
Principal Balance Certificates outstanding as of any date of determination. On
each Distribution
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Date, the Class Principal Balance of each Class of the Principal Balance
Certificates shall be reduced by the amount of any distributions of principal
made thereon on such Distribution Date pursuant to Section 4.01(c) and, if and
to the extent appropriate, shall be further reduced on such Distribution Date as
provided in Section 4.04(c).
"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-16
attached hereto, and evidencing the sole class of "residual interests" in REMIC
I for purposes of the REMIC Provisions.
"Class R-II Certificate": Any one of the Certificates with a "Class R-II"
designation on the face thereof, substantially in the form of Exhibit A-17
attached hereto, and evidencing the sole class of "residual interests" in REMIC
II for purposes of the REMIC Provisions.
"Class R-III Certificate": Any one of the Certificates with a "Class R-III"
designation on the face thereof, substantially in the form of Exhibit A-18
attached hereto, and evidencing the sole class of "residual interests" in REMIC
III for purposes of the REMIC Provisions.
"Class R-I Distribution Amount": Any amounts available to be paid to the
holders of the Class R-I Certificates after all REMIC I Regular Interests have
been paid in full.
"Class R-II Distribution Amount": Any amounts available to be paid to the
holders of the Class R-II Certificates after all REMIC II Regular Interests have
been paid in full.
"Class X Certificate": Any one of the Certificates with a "Class X"
designation on the face thereof, substantially in the form of Exhibit A-1, and
evidencing a "regular interest" in REMIC III for purposes of the REMIC
Provisions.
"Class X Component": Any of the 14 components comprising the Class X
Certificates which are identified as Class LA-1, LA-2, LB, LC, LD, LE, LF, LG,
LH, LJ, LK, LL, LM and LN Components.
"Closing Date": May 18, 1998.
"Code": The Internal Revenue Code of 1986.
"Collection Period": With respect to any Distribution Date, the period
commencing immediately following the prior such period (or, in the case of the
initial Collection Period, commencing immediately following the Cut-off Date)
and ending on and including the related Determination Date.
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"Collection Report": The monthly report to be prepared by the Master
Servicer and delivered to the Trustee and the Depositor pursuant to Section
4.02(b).
"Commission": The Securities and Exchange Commission.
"Compensating Interest Payments": Any payment required to be made by the
Master Servicer pursuant to Section 3.19(f) to cover Prepayment Interest
Shortfalls or Section 3.19(e) to cover Balloon Payment Interest Shortfalls.
"Component Rate": As to each of the Class X Components, the rate set forth
below with respect thereto:
"Controlling Class": As of any date of determination, the outstanding Class
of Principal Balance Certificates with the lowest Payment Priority (the Class A
Certificates being treated as a single Class for this purpose) that has a then
outstanding Class Principal Balance at least equal to 25% of the Initial Class
Principal Balance thereof (or, if no Class of Principal Balance Certificates
outstanding has a Class Principal Balance at least equal to 25% of the Initial
Class Principal Balance thereof, then the "Controlling Class" shall be the
outstanding Class of Principal Balance Certificates with the then largest
remaining Class Principal Balance, and if two or more classes of Principal
Balance Certificates have the largest remaining Class Principal Balances, the
outstanding class of Principal Balance Certificates with the lowest Payment
Priority). Initially, the Controlling Class will consist of the Class N
Certificates.
"Corporate Trust Office": The principal corporate trust office of the
Trustee at which at any particular time its corporate trust business with
respect to this Agreement shall be administered, which office at the date of the
execution of this Agreement is located at 135 South LaSalle Street, Suite 1625,
Chicago, Illinois 60674-4107, Attention: Asset-Backed Securities Trust Services
Group - GMAC Commercial Mortgage Securities, Inc. Series 1998-C1.
"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" (other than by reason of a
Liquidation Event occurring in respect of such Mortgage Loan or a related
Mortgaged Property becoming an REO Property).
"CPR": An assumed constant rate of prepayment each month (which is quoted
on a per annum basis) relative to the then outstanding principal balance of a
pool of mortgage loans for the life of such mortgage loans.
"Credit File": Any documents, other than documents required to be part of
the related Mortgage File, in the possession of the Master Servicer or Special
Servicer and relating to the origination and servicing of any Mortgage Loan.
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"Cross-Collateralized Mortgage Loans": Any two or more Mortgage Loans
listed on the Mortgage Loan Schedule that are cross-collateralized with each
other.
"Current Principal Distribution Amount": With respect to any Distribution
Date, an amount equal to the aggregate of:
(a) the principal portions of all Monthly Payments (other than Balloon
Payments) and any Assumed Monthly Payments due or deemed due, as the case
may be, in respect of the Mortgage Loans and any REO Loans for their
respective Due Dates occurring during the related Collection Period;
(b) all Principal Prepayments received on the Mortgage Loans during
the related Collection Period;
(c) with respect to any Balloon Mortgage Loan as to which the related
Stated Maturity Date occurred during or prior to the related Collection
Period, any payment of principal (exclusive of any Principal Prepayment and
any amount described in subclause (d) below) that was made by or on behalf
of the related Mortgagor during the related Collection Period, net of any
portion of such payment that represents a recovery of the principal portion
of any Monthly Payment (other than a Balloon Payment) due, or the principal
portion of any Assumed Monthly Payment deemed due, in respect of such
Balloon Mortgage Loan on a Due Date during or prior to the related
Collection Period and not previously recovered;
(d) that portion of all Liquidation Proceeds and Insurance Proceeds
received on or in respect of the Mortgage Loans during the related
Collection Period that were identified and applied by the Master Servicer
as recoveries of principal thereof, in each case net of any portion of such
amounts that represents a recovery of the principal portion of any Monthly
Payment (other than a Balloon Payment) due, or of the principal portion of
any Assumed Monthly Payment deemed due, in respect of any such Mortgage
Loan on a Due Date during or prior to the related Collection Period and not
previously recovered; and
(e) that portion of all Liquidation Proceeds, Insurance Proceeds and
REO Revenues received on or in respect of any REO Properties during the
related Collection Period that were identified and applied by the Master
Servicer as recoveries of principal of the REO Loans, in each case net of
any portion of such amounts that represents a recovery of the principal
portion of any Monthly Payment (other than a Balloon Payment) due, or of
the principal portion of any Assumed Monthly Payment deemed due, in respect
of any such REO Loan or the related Mortgage Loan on a Due Date during or
prior to the related Collection Period and not previously recovered.
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"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, the Mortgage Loan Seller or an Affiliate of either
of them.
"Cut-off Date": May 1, 1998.
"Cut-off Date Principal 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 payments of principal due on or before such date,
whether or not received.
"Debt Service Coverage Ratio": With respect to any Mortgage Loan (or group
of Cross-Collateralized Mortgage Loans) for any specified period, the debt
service coverage ratio calculated in accordance with Exhibit I using the
methodologies set forth in Exhibit F.
"Debt Service Reduction": With respect to any Mortgage Loan, a reduction in
the scheduled Monthly Payment for such Mortgage Loan by a court of competent
jurisdiction in a proceeding under the Bankruptcy Code, other than a reduction
resulting from a Deficient Valuation.
"Defaulted Mortgage Loan": A Mortgage Loan that is delinquent in an amount
equal to at least two Monthly Payments or is delinquent thirty days or more in
respect of its Balloon Payment, if any, 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.
"Default Interest": With respect to any Mortgage Loan (or related REO
Loan), any amounts collected thereon, other than late payment charges and
Prepayment Premiums, that represent penalty interest in excess of interest on
the principal balance of such Mortgage Loan (or REO Loan) accrued at the related
Mortgage Rate.
"Defeasance Collateral": Noncallable government obligations of (or
non-callable obligations, fully guaranteed as to timely payment by) the United
States of America, as are permitted under the terms of a Mortgage Note or
related Mortgage Loan Documents, but only if such obligations or assets
constitute "government securities" under the defeasance rule of the REMIC
Provisions.
"Defeasance Loan": A Mortgage Loan that is designated as such on the
Mortgage Loan Schedule.
"Defeasance Option": The right of a Mortgagor, pursuant to the terms of the
related Mortgage Note or related Mortgage Loan Documents, to obtain a release of
the related Mortgaged Property from the lien of the related Mortgages upon the
pledge to the Trustee of Defeasance Collateral.
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"Defect": As defined in Section 2.02(e).
"Deficient Valuation": With respect to any Mortgage Loan, a valuation by a
court of competent jurisdiction of the Mortgaged Property in an amount less than
the then outstanding principal balance of the Mortgage Loan, which valuation
results from a proceeding initiated under the Bankruptcy Code.
"Definitive Certificate": As defined in Section 5.03(a).
"Deleted Mortgage Loan": means a Mortgage Loan which is repurchased from
the Trust pursuant to the terms hereof or as to which one or more Qualifying
Substitute Mortgage Loans are substituted.
"Delinquency Advance": As to any Mortgage Loan or REO Loan, any advance
made by the Master Servicer, the Trustee or the Fiscal Agent pursuant to Section
4.03.
"Delinquency Advance Date": The Business Day preceding each Distribution
Date.
"Delinquent Loan Status Report": A report or reports setting forth, among
other things, those Mortgage Loans which, as of the close of business on the
immediately preceding Determination Date, were (i) delinquent 30-59 days, (ii)
delinquent 60-89 days, (iii) delinquent 90 days or more, (iv) current but
specially serviced, (v) in foreclosure but as to which the related Mortgaged
Property had not become REO Property, or (vi) related to Mortgaged Property
which had become REO Property, together with such additional information in
respect of each such Mortgage Loan as is contemplated on Exhibit H hereto.
"Depositor": GMAC Commercial Mortgage Securities, Inc. or its successor in
interest.
"Depository": The Depository Trust Company, or any successor Depository
hereafter named. The nominee of the initial Depository for purposes of
registering those Certificates that are to be Book-Entry Certificates, is Cede &
Co. The Depository shall at all times be a "clearing corporation" as defined in
Section 8-102(3) of the Uniform Commercial Code of the State of New York and a
"clearing agency" registered pursuant to the provisions of Section 17A of the
Exchange Act.
"Depository Participant": A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
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"Determination Date": With respect to any Distribution Date, the 5th day of
the month in which such Distribution Date occurs, or if such 5th 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 that are not (within the meaning of
Treasury Regulations Section 1.512(b)-1(c)(5)) customarily provided to tenants
in connection with the rental of space for occupancy, the management or
operation of such REO Property, the holding of such REO Property primarily for
sale to customers in the ordinary course of a trade or business, the performance
of any construction work thereon or any use of such REO Property in a trade or
business conducted by REMIC I, in each case other than through an Independent
Contractor; provided, however, that the Trustee (or the Special Servicer on
behalf of the Trustee) shall not be considered to Directly Operate an REO
Property solely because the Trustee (or the Special 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 (of the
type that would be deductible under Code Section 162) or capital expenditures
with respect to such REO Property.
"Discount Rate": With respect to each Mortgage Loan as to which there has
been a prepayment during a Collection Period and for which a Prepayment Premium
is collected, the yield (compounded monthly) for "This Week" as reported by the
Federal Reserve Board in Federal Reserve Statistical Release H.15(519) for the
constant maturity treasury having a maturity coterminous with the Anticipated
Repayment Date, in the case of an ARD Loan, or the Maturity Date, in the case of
each other Mortgage Loan, of such Mortgage Loan as of the related Determination
Date. If there is no Discount Rate for instruments having a maturity coterminous
with the Maturity Date or Anticipated Repayment Date, as applicable, of the
applicable Mortgage Loan, then the Discount Rate will be equal to the linear
interpolation of the yields of the constant maturity treasuries with maturities
next longer and shorter than such Maturity Date or Anticipated Repayment Date.
"Discount Rate Fraction": With respect to the distribution of any
Prepayment Premium received with respect to any Mortgage Loan to one or more
Classes of Certificates on any Distribution Date, a fraction (not greater than
1.0 or less than zero), (a) the numerator of which is equal to the excess of (x)
the Pass-Through Rate for such Class of Certificates over (y) the relevant
Discount Rate and (b) the denominator of which is equal to the excess of (x) the
Mortgage Rate of the related Mortgage Loan over (y) the relevant Discount Rate;
provided, that if there are two or more of such Classes of Certificates entitled
to distributions from the Principal Distribution Amount on such Distribution
Date, the Pass-Through Rate for purposes of clause (x) above will be the
Pass-Through Rate for the Class with the earlier alphabetic or numeric
designation.
"Distributable Certificate Interest": With respect to any Class of REMIC
III Regular Certificates, for any Distribution Date, the Accrued Certificate
Interest in respect of
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such Class of Certificates for such Distribution Date, reduced (to not less than
zero) by that portion, if any, of the Net Aggregate Prepayment Interest
Shortfall, if any, for such Distribution Date allocated to such Class of
Certificates as set forth below. The Net Aggregate Prepayment Interest
Shortfall, if any, for each Distribution Date shall be allocated on such
Distribution Date: first, to the respective Classes of Principal Balance
Certificates (other than the Class A Certificates), sequentially in reverse
alphabetical order of Class designation, in each case up to the amount of any
Accrued Certificate Interest in respect of such Class of Certificates for such
Distribution Date; and thereafter, among the respective Classes of Senior
Certificates, pro rata, in accordance with the respective amounts of Accrued
Certificate Interest for such Classes of Certificates for such Distribution
Date.
"Distribution Account": The segregated account or accounts created and
maintained by the Trustee pursuant to Section 3.04(b) in trust for the
Certificateholders, which shall be entitled "LaSalle National Bank, as Trustee,
in trust for the registered holders of GMAC Commercial Mortgage Securities,
Inc., Mortgage Pass-Through Certificates, Series 1998-C1". Any such account or
accounts shall be an Eligible Account.
"Distribution Date": The 15th day of any month, or if such 15th day is not
a Business Day, the Business Day immediately following, commencing in June 1998.
"Distribution Date Statement": As defined in Section 4.02(a).
"Due Date": With respect to (i) any Mortgage Loan on or prior to its
Maturity Date, the day of the month set forth in the related Mortgage Note on
which each Monthly Payment thereon is scheduled to be first due; (ii) any
Balloon Mortgage Loan after the Maturity Date therefor, 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": An account that is any of the following: (i) maintained
with a depository institution or trust company whose (A) commercial paper,
short-term unsecured debt obligations or other short-term deposits are rated at
least P-1 by Moody's and if rated by FITCH IBCA, F-1+ (or its equivalent) if the
deposits are to be held in the account for less than 30 days, or (B) long-term
unsecured debt obligations are rated at least Aa3 by Moody's and if rated by
FITCH IBCA, AA-, (or its equivalent) if the deposits are to be held in the
account more than 30 days, or (ii) a segregated trust account or accounts
maintained in the trust department of the Trustee or other financial institution
subject to regulations regarding fiduciary funds on deposit similar to Title 12
of the Code of Federal Regulations Section 9.10(b), or (iii) an account or
accounts of a depository institution acceptable to each Rating Agency, as
evidenced by written confirmation from such Rating Agency to the effect that use
of any such account as the Certificate Account or the Distribution Account would
not result in the downgrade, qualification or withdrawal of the rating then
assigned to any Class of Certificates by such Rating Agency.
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"Emergency Advance": Any Servicing Advance that must be made within five
Business Days by the Special Servicer in order to avoid any material penalty,
any material harm to a Mortgaged Property or any other material adverse
consequence to the Trust Fund.
"Environmental Assessment": A "Phase I assessment" conducted in accordance
with ASTM Standard E 1527-93 or any successor thereto published by ASTM.
"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 similar items in respect of the related Mortgaged Property.
"Event of Default": One or more of the events described in Section 7.01(a).
"Excess Interest": With respect to each of the ARD Loans, interest accrued
on such ARD Loan and allocable to the Excess Rate. The Excess Interest is an
asset of the Trust Fund.
"Excess Rate": With respect to each ARD Loan after the related Anticipated
Repayment Date, the excess of (i) the applicable Revised Rate over (ii) the
applicable initial Mortgage Rate, each as set forth in the Mortgage Loan
Schedule.
"Exchange Act": The Securities Exchange Act of 1934, as amended.
"FDIC": Federal Deposit Insurance Corporation or any successor.
"FHLMC": Federal Home Loan Mortgage Corporation or any successor.
"Final Distribution Date": The final Distribution Date on which any
distributions are to be made on the Certificates as contemplated by Section
9.01.
"Final Recovery Determination": A determination by the Special Servicer
with respect to any defaulted Mortgage Loan or REO Property (other than a
Mortgage Loan or REO Property, as the case may be, that was purchased by a
Mortgage Loan Seller pursuant to Section 6 of the related Mortgage Loan Purchase
Agreement, by the Majority Certificateholder of a Controlling Class pursuant to
Section 3.18(b) or by the Master Servicer or the Special Servicer pursuant to
Section 3.18(c) or by the Master Servicer or the Depositor pursuant to Section
9.01) that, in the reasonable and good faith judgment of the Special Servicer,
there has been a recovery of all Insurance Proceeds, Liquidation Proceeds and
other payments or recoveries that, in the Special Servicer's judgment, exercised
without regard to any obligation of the Master
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Servicer or the Special Servicer to make payments from its own funds pursuant to
Section 3.07(b), will ultimately be recoverable.
"Fiscal Agent": ABN AMRO Bank N.V., a banking organization organized under
the laws of the Netherlands, its successor in interest, or any successor Fiscal
Agent appointed as provided herein.
"Fiscal Agent Termination Event": As defined in Section 8.15.
"FITCH IBCA": FITCH IBCA, Inc. or its successor in interest. If neither
such rating agency nor any successor remains in existence, "FITCH IBCA" 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 FITCH IBCA Inc. herein referenced shall be deemed to refer
to the equivalent ratings of the party so designated.
"Fixed Rate Mortgage Loan": A Mortgage Loan as to which the related
Mortgage Note provides, as of the Closing Date, for a Mortgage Rate that remains
fixed through the remaining term thereof (without regard to any extension at the
Mortgagor's or the mortgagee's option under the terms of the related Mortgage
Loan documents).
"FNMA": Federal National Mortgage Association or any successor.
"GMACCM": GMAC Commercial Mortgage Corporation or its successor in
interest.
"GACC": German American Capital Corporation or its successor in interest.
"Gross Margin": With respect to each Adjustable Rate Mortgage Loan (and any
successor REO Loan), the fixed number of percentage points set forth in the
Mortgage Loan Schedule that is added to the applicable value of the related
Index on each Interest Rate Adjustment Date in accordance with the terms of the
related Mortgage Note to determine, subject to any applicable periodic and
lifetime limitations on adjustments thereto, the related Mortgage Rate.
"Ground Lease": The ground lease pursuant to which any Mortgagor holds a
leasehold interest in the related Mortgaged Property.
"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, and specifically including, without limitation,
asbestos and asbestos-containing materials, polychlorinated biphenyls ("PCBs"),
radon gas, petroleum and petroleum products, urea formaldehyde and any
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substances classified as being "in inventory", "usable work in process" or
similar classification which would, if classified as unusable, be included in
the foregoing definition.
"Historical Loan Modification Report": A report or reports setting forth,
among other things, those Mortgage Loans which, as of the close of business on
the immediately preceding Determination Date, have been modified pursuant to
this Agreement (i) during the Collection Period ending on such Determination
Date and (ii) since the Cut-off Date, showing the original and the revised terms
thereof, together with such additional information in respect of each such
Mortgage Loan as is contemplated by Exhibit H hereto.
"Historical Loss Report": A report or reports setting forth, among other
things, as of the close of business on the immediately preceding Determination
Date, (i) the amount of Liquidation Proceeds and Liquidation Expenses, both for
the Collection Period ending on such Determination Date and for all prior
Collection Periods, and (ii) the amount of Realized Losses occurring during such
Collection Period and historically, set forth on a Mortgage Loan-by-Mortgage
Loan and REO Property-by-REO Property basis, together with such additional
information in respect of each Mortgage Loan and REO Property as to which a
Final Recovery Determination has been made as is contemplated by Exhibit H
hereto.
"Independent": When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor, the Master Servicer, the
Special Servicer, the Trustee, the Fiscal Agent 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, the Fiscal Agent or any Affiliate thereof, and
(iii) is not connected with the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent or any Affiliate thereof as an officer,
employee, promoter, underwriter, trustee, partner, director or Person performing
similar functions; provided, however, that a Person shall not fail to be
Independent of the Depositor, the Master Servicer, the Special Servicer or any
Affiliate thereof merely because such Person is the beneficial owner of 1% or
less of any class of securities issued by the Depositor, the Master Servicer or
any Affiliate thereof, as the case may be.
"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 Trustee or
the Trust Fund, delivered to the Trustee), so long as REMIC I does not receive
or derive any income from such Person and provided that the relationship between
such Person and REMIC I is at arm's length, all within the meaning of Treasury
Regulation Section 1.856-4(b)(5), or any other Person upon receipt by the
Trustee of an Opinion of Counsel, which shall be at no expense to the Trustee or
the Trust Fund, to the effect that the taking of any action in respect of any
REO Property by
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such Person, subject to any conditions therein specified, that is otherwise
herein contemplated to be taken by an Independent Contractor will not cause such
REO Property to cease to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code (determined without regard to the exception
applicable for purposes of Section 860D(a) of the Code), or cause any income
realized in respect of such REO Property to fail to qualify as Rents from Real
Property.
"Index": With respect to each Adjustable Rate Mortgage Loan (and any
successor REO Loan), for each Interest Rate Adjustment Date, the base index used
to determine the new Mortgage Rate in effect thereon as specified in the related
Mortgage Note. If the Index currently in effect for any Adjustable Rate Mortgage
Loan (or successor REO Loan) ceases to be available, the Master Servicer shall,
subject to Section 3.19 and the terms of the related Mortgage Note, select a
comparable alternative index.
"Initial Balance": The aggregate Cut-off Date Principal Balance of the
Mortgage Loans.
"Initial Class Notional Amount": With respect to the Class X Certificates,
the initial Class Notional Amount thereof as of the Closing Date, equal to
$1,438,000,263.
"Initial Class Principal Balance": With respect to any Class of Principal
Balance Certificates, the initial Class Principal Balance thereof as of the
Closing Date, in each case as set forth in the Preliminary Statement.
"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 or released to the Mortgagor, in either case, in accordance with the
Servicing Standard (including any amounts paid by the Master Servicer or Special
Servicer pursuant to Section 3.07).
"Interest Accrual Period": With respect to any Distribution Date, the
calendar month immediately preceding the month in which such Distribution Date
occurs.
"Interest Rate Adjustment Date": With respect to each Adjustable Rate
Mortgage Loan (and any successor REO Loan), any date on which the related
Mortgage Rate is subject to adjustment pursuant to the related Mortgage Note.
The first Interest Rate Adjustment Date subsequent to the Cut-off Date for each
Adjustable Rate Mortgage Loan is specified in the Mortgage Loan Schedule, and
successive Interest Rate Adjustment Dates for such Mortgage Loan (and any
successor REO Loan) shall thereafter periodically occur with the frequency
specified in the Mortgage Loan Schedule.
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"Interest Reserve Account": The segregated account created and maintained
by the Trustee pursuant to Section 3.04(c) in trust for the Certificateholders,
which shall be entitled "LaSalle National Bank, as Trustee, in trust for the
registered holders of GMAC Commercial Mortgage Securities, Inc., Mortgage
Pass-Through Certificates, Series 1998-C1 -- Interest Reserve Account." Any such
account shall be an Eligible Account.
"Interest Reserve Loans": Any Mortgage Loan bearing interest computed on an
actual/360 basis and having a Mortgage Rate (less the Servicing Fee Rate) as of
the Cut-off Date less than 7.62% per annum.
"Interested Person": The Depositor, the Master Servicer, the Special
Servicer, any Holder of a Certificate, or any Affiliate of any such Person.
"Issue Price": With respect to each Class of Certificates, the "issue
price" as defined in the REMIC Provisions.
"Late Collections": With respect to any Mortgage Loan, all amounts received
thereon during any Collection Period, whether as payments, Insurance Proceeds,
Liquidation Proceeds, payments of Substitution Shortfall Amounts, or otherwise,
which represent late payments or collections of principal or interest due in
respect of such Mortgage Loan (without regard to any acceleration of amounts due
thereunder by reason of default) on a Due Date in a previous Collection Period
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 principal or interest due or deemed due in
respect of such REO Loan or the predecessor Mortgage Loan (without regard to any
acceleration of amounts due under the predecessor Mortgage Loan by reason of
default) on a Due Date in a previous Collection Period and not previously
recovered. The term "Late Collections" shall specifically exclude Penalty
Charges.
"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 Section 6 of the
related Mortgage Loan Purchase Agreement; (iv) such Mortgage Loan is purchased
by the Majority Certificateholder of the Controlling Class pursuant to Section
3.18(b); (v) such Mortgage Loan is purchased by the Master Servicer or the
Special Servicer pursuant to Section 3.18(c); or (vi) such Mortgage Loan is
purchased by the Master Servicer or the Depositor 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 Master Servicer or the
Depositor pursuant to Section 9.01.
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"Liquidation Expenses": All customary, reasonable and necessary "out of
pocket" costs and expenses incurred by the Special Servicer in connection with
the liquidation of any Specially Serviced Mortgage Loan or REO Property pursuant
to Section 3.09 or 3.18 (including, without limitation, legal fees and expenses,
committee or referee fees and, if applicable, brokerage commissions and
conveyance taxes).
"Liquidation Fee": With respect to each Specially Serviced Mortgage Loan or
REO Property (other than any Specially Serviced Mortgage Loan or REO Property
purchased by the Majority Certificateholder of the Controlling Class, the Master
Servicer or the Special Servicer pursuant to Section 3.18 or by the Master
Servicer or the Depositor pursuant to Section 9.01), the fee designated as such
and payable to the Special Servicer pursuant to Section 3.11(c).
"Liquidation Fee Rate": With respect to each Specially Serviced Mortgaged
Loan or REO Property as to which a Liquidation Fee is payable, 1.00%.
"Liquidation Proceeds": Cash amounts (other than Insurance Proceeds and REO
Revenues) received or paid by the Master Servicer or the Special Servicer in
connection with: (i) the taking of all or a part of a Mortgaged Property by
exercise of the power of eminent domain or condemnation; (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 Certificateholder of the Controlling
Class 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 Section 6 of the related Mortgage Loan Purchase Agreement; (vi) the
payment of any Substitution Shortfall Amount by a Mortgage Loan Seller pursuant
to Section 6 of the related Mortgage Loan Purchase Agreement; or (vii) the
purchase of a Mortgage Loan or REO Property by the Master Servicer or the
Depositor pursuant to Section 9.01.
"Loan-to-Value Ratio": With respect to any Mortgage Loan, as of any date of
determination, the fraction, expressed as a percentage, the numerator of which
is the then unpaid principal balance of such Mortgage Loan, and the denominator
of which is the Appraised Value of the related Mortgaged Property as determined
by an Appraisal thereof.
"Lock-Box Account": With respect to any Mortgaged Property, if applicable,
any account created pursuant to any documents relating to a Mortgage Loan to
receive revenues therefrom. Any Lock-Box Account shall be beneficially owned for
federal income tax purposes by the Person who is entitled to receive the
reinvestment income or gain thereon in accordance with the terms and provisions
of the related Mortgage Loan and Section 3.06, which Person shall
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be taxed on all reinvestment income or gain thereon. The Master Servicer shall
be permitted to make withdrawals therefrom for deposit into the related Cash
Collateral Accounts.
"Lock-Box Agreement": With respect to any Mortgage Loan, the lock-box
agreement, if any, between the originator of such Mortgage Loan and the
Mortgagor, pursuant to which the related Lock-Box Account, if any, is to be
established.
"Loss Reimbursement Amount": With respect to any REMIC I Regular Interest
and any Distribution Date (except the initial Distribution Date, with respect to
which the Loss Reimbursement Amount for such REMIC I Regular Interest will be
zero), an amount equal to (a)(i) the Loss Reimbursement Amount with respect to
such REMIC I Regular Interest for the immediately preceding Distribution Date,
minus (ii) the aggregate of all reimbursements deemed made to REMIC II on the
immediately preceding Distribution Date pursuant to Section 4.01(a)(iii) with
respect to such REMIC I Regular Interest, plus (iii) the aggregate of all
reductions made to the Uncertificated Principal Balance of (and, accordingly,
the aggregate of all Realized Losses and Additional Trust Fund Expenses deemed
allocated to) such REMIC I Regular Interest on the immediately preceding
Distribution Date pursuant to Section 4.04(a), plus (b) one month's interest
(calculated on the basis of a 360-day year consisting of twelve 30-day months
or, if the related Mortgage Loan or REO Loan accrues interest on a different
basis, on such alternative basis) on the amount described in clause (a) of the
REMIC I Remittance Rate applicable to such REMIC I Regular Interest for the
current Distribution Date.
"MAI": Member of Appraisal Institute.
"Majority Certificateholder": With respect to any specified Class or
Classes of Certificates, as of any date of determination, any Holder or
particular group of Holders of Certificates of such Class or Classes, as the
case may be, entitled to a majority of the Voting Rights allocated to such Class
or Classes, as the case may be.
"Master Servicer": GMACCM, or any successor master servicer appointed as
herein provided.
"Master Servicer Remittance Date": The Business Day preceding each
Distribution Date.
"Master Servicer Remittance Report": A data file prepared by the Master
Servicer and in such media as may be agreed upon by the Master Servicer and the
Trustee containing such information regarding the Mortgage Loans as will permit
the Trustee to calculate the amounts to be distributed to the Certificateholders
pursuant to this Agreement and to furnish the Distribution Date Statement to
Certificateholders required to be delivered hereunder and containing such
additional information as the Master Servicer, the Trustee and the Depositor may
from time to time mutually agree.
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"Master Servicing Fee": With respect to each Mortgage Loan and REO Loan,
the fee designated as such and payable to the Master Servicer pursuant to
Section 3.11(a).
"Master Servicing Fee Rate": With respect to each Mortgage Loan and REO
Loan acquired by the Depositor from the following Persons, the rate set forth
opposite the name of such Person:
GACC 0.02000%
GMACCM 0.02000%
"Maturity Date": With respect to any Mortgage Loan as of any date of
determination, the date on which the last payment of principal is due and
payable under the related Mortgage Note, after taking into account all Principal
Prepayments received prior to such date of determination and any extension
permitted at the Mortgagor's option under the terms of the related Mortgage Note
(as in effect on the Closing Date) and this Agreement, but without giving effect
to (i) any acceleration of the principal of such Mortgage Loan by reason of
default thereunder, (ii) any grace period permitted by the related Mortgage
Note, or (iii) any modification, waiver or amendment of such Mortgage Loan
granted or agreed to by the Master Servicer or Special Servicer pursuant to
Section 3.20.
"Modified Mortgage Loan": Any Mortgage Loan as to which any Servicing
Transfer Event has occurred and which has been modified by the Special Servicer
pursuant to Section 3.20 in a manner that:
(A) affects the amount or timing of any payment of principal or
interest due thereon (other than, or in addition to, bringing current
Monthly Payments with respect to such Mortgage Loan);
(B) except as expressly contemplated by the related Mortgage, results
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 is), as determined by an
Appraisal 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
(C) in the good faith and reasonable judgment of the Special Servicer,
otherwise materially impairs the security for such Mortgage Loan or reduces
the likelihood of timely payment of amounts due thereon.
"Monthly Payment": With respect to any Mortgage Loan, the scheduled monthly
payment of principal and/or interest on such Mortgage Loan, including any
Balloon Payment, which is payable by a Mortgagor from time to time under the
terms of the related Mortgage Note (as such may be modified at any time
following the Closing Date) and applicable law.
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"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, separately and collectively,
as the context may require, each mortgage, deed of trust or other instrument
securing a Mortgage Note and creating a lien on the related Mortgaged Property.
"Mortgage File": With respect to any Mortgage Loan (other than the Senior
Living Loan), subject to Section 2.01(b), collectively the following documents:
(1) the original Mortgage Note, endorsed by the most recent endorsee prior
to the Trustee or, if none, by the originator, without recourse, in blank
or to the order of the Trustee in the following form: "Pay to the order of
LaSalle National Bank, as Trustee for the registered holders of GMAC
Commercial Mortgage Securities, Inc., Mortgage Pass-Through Certificates,
Series 1998-C1, without recourse";
(2) the original or a copy of the Mortgage and, if applicable, the
originals or copies of any intervening assignments thereof showing a
complete chain of assignment from the originator of the Mortgage Loan to
the most recent assignee of record thereof prior to the Trustee, if any, in
each case with evidence of recording indicated thereon;
(3) an original assignment of the Mortgage, in recordable form, executed by
the most recent assignee of record thereof prior to the Trustee, or if none
by the originator, either in blank or in favor of the Trustee (in such
capacity);
(4) an original or copy of any related Assignment of Leases (if such item
is a document separate from the Mortgage) and, if applicable, the originals
or copies of any intervening assignments thereof showing a complete chain
of assignment from the originator of the Mortgage Loan to the most recent
assignee of record thereof prior to the Trustee, if any, in each case with
evidence of recording thereon;
(5) an original assignment of any related Assignment of Leases (if such
item is a document separate from the Mortgage), in recordable form,
executed by the most recent assignee of record thereof prior to the
Trustee, or, if none, by the originator, either in blank or in favor of the
Trustee (in such capacity), which assignment may be included as part of the
corresponding assignment of Mortgage, referred to in clause (3) above;
(6) an original or a copy of any related Security Agreement (if such item
is a document separate from the Mortgage) and, if applicable, the originals
or copies of any
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intervening assignments thereof showing a complete chain of assignment from
the originator of the Mortgage Loan to the most recent assignee of record
thereof prior to the Trustee, if any;
(7) an original assignment of any related Security Agreement (if such item
is a document separate from the Mortgage) executed by the most recent
assignee of record thereof prior to the Trustee or, if none, by the
originator, either in blank or in favor of the Trustee (in such capacity),
which assignment may be included as part of the corresponding assignment of
Mortgage referred to in clause (3) above;
(8) originals or copies of all assumption, modification, written assurance
and substitution agreements, with evidence of recording thereon, where
appropriate, in those instances where the terms or provisions of the
Mortgage, Mortgage Note or any related security document have been modified
or the Mortgage Loan has been assumed;
(9) the original or a copy of the lender's title insurance policy issued as
of the date of the origination of the Mortgage Loan, together with all
endorsements or riders (or copies thereof) that were issued with or
subsequent to the issuance of such policy, insuring the priority of the
Mortgage as a first lien on the Mortgaged Property;
(10) the original or a copy of any guaranty of the obligations of the
Mortgagor under the Mortgage Loan which was in the possession of the
Mortgage Loan Seller at the time the Mortgage Files were delivered to the
Trustee;
(11) (A) file or certified copies of any UCC financing statements and
continuation statements which were filed in order to perfect (and maintain
the perfection of) any security interest held by the originator of the
Mortgage Loan (and each assignee of record prior to the Trustee) in and to
the personalty of the Mortgagor at the Mortgaged Property (in each case
with evidence of filing thereon) and which were in the possession of the
Seller (or its agent) at the time the Mortgage Files were delivered and (B)
if any such security interest is perfected and the earlier UCC financing
statements and continuation statements were in the possession of the
Seller, a UCC financing statement executed by the most recent assignee of
record prior to the Trustee or, if none, by the originator, evidencing the
transfer of such security interest, either in blank or in favor of the
Trustee;
(12) the original or a copy of the power of attorney (with evidence of
recording thereon, if appropriate) granted by the Mortgagor if the
Mortgage, Mortgage Note or other document or instrument referred to above
was not signed by the Mortgagor;
(13) the related Ground Lease or a copy thereof, if any, and
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(14) any additional documents required to be added to the Mortgage File
pursuant to this Agreement;
provided that whenever the term "Mortgage File" is used to refer to documents
actually received by the Trustee or a Custodian appointed thereby, such term
shall not be deemed to include such documents and instruments required to be
included therein unless they are actually so received.
The "Mortgage File" with respect to the Senior Living Loan shall
collectively consist of:
(a) the documents referred to in clauses (1), (2), (4), (6), (8), (9),
(10), (11) (in the case of clause (11), evidencing the transfer of a
security interest, either in blank or in favor of The First National
Bank of Chicago, as trustee, under the Senior Living Trust Agreement),
(12) and (13) above;
(b) the Senior Living Trust Agreement;
(c) the Senior Living Subrogation Agreement;
(d) the First Amendment to the Subrogation and Note Purchase Agreement,
dated as of April 1, 1998, between the Seller and ZC Specialty
Insurance Company;
(e) the Loan Agreement, dated as of February 6, 1998, among Senior Living
Properties LLC, SLP Illinois, LLC and the Seller;
(f) the First Amendment to Loan Agreement dated as of April 1, 1998, among
Senior Living Properties LLC, SLP Illinois, LLC and the Seller; and
(g) a copy of the Senior Living Surety Bond.
"Mortgage Loan": Each of the mortgage loans transferred and assigned to the
Trustee pursuant to Section 2.01 and from time to time held in the Trust Fund
(including, without limitation, all Replacement Mortgage Loans). As used herein,
the term "Mortgage Loan" includes the related Mortgage Note, Mortgage and other
security documents contained in the related Mortgage File.
"Mortgage Loan Accrual Period": With respect to any Mortgage Loan and any
Due Date therefor, the one month period immediately preceding such Due Date.
"Mortgage Loan Accrued Interest": With respect to any Mortgage Loan for any
related Mortgage Loan Accrual Period, the aggregate amount of interest accrued
in respect of such Mortgage Loan during such Mortgage Loan Accrual Period at the
Mortgage Rate then in effect.
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"Mortgage Loan Purchase Agreement": With respect to any Mortgage Loan
Seller, the agreement between the Depositor and such Mortgage Loan Seller,
relating to the transfer of all of such Mortgage Loan Seller's right, title and
interest in and to the Mortgage Loans.
"Mortgage Loan Schedule": The list of Mortgage Loans transferred on the
Closing Date to the Trustee as part of the Trust Fund, attached hereto as
Schedule I, which list sets forth the following information with respect to each
Mortgage Loan:
(i) the loan number;
(ii) the street address (including city, state and zip code) of the
related Mortgaged Property;
(iii) the Mortgage Rate in effect as of the Cut-off Date;
(iv) the original principal balance;
(v) the Cut-off Date Principal Balance;
(vi) the (A) remaining term to stated maturity, (B) with respect to each
ARD Loan, the Anticipated Repayment Date and (C) Stated Maturity
Date;
(vii) the Due Date;
(viii) the amount of the Monthly Payment due on the first Due Date
following the Cutoff Date;
(ix) whether such Mortgage Loan is an ARD Loan or a Defeasance Loan; and
(x) the Servicing Fee Rate.
Such schedule shall also set forth the aggregate Cut-off Date Principal Balance
for all of the Mortgage Loans. Such list may be in the form of more than one
list, collectively setting forth all of the information required.
"Mortgage Loan Seller": Any of GMACCM and GACC.
"Mortgage Note": The original executed note evidencing the indebtedness of
a Mortgagor under a Mortgage Loan, together with any rider, addendum or
amendment thereto.
"Mortgage Pool": Collectively, all of the Mortgage Loans (including any REO
Loans and Replacement Loans, but excluding Deleted Mortgage Loans).
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"Mortgage Rate": With respect to: (i) any Mortgage Loan on or prior to its
Maturity Date, the fixed or adjustable annualized 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 terms of the related Mortgage Note (as such
may be modified at any time following the Closing Date) and applicable law; (ii)
any Mortgage Loan after its Maturity Date, the annualized rate described in
clause (i) above determined without regard to the passage of such Maturity Date;
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": Individually and collectively, as the context may
require, the real property interest subject to the lien of a Mortgage and
constituting collateral for a Mortgage Loan. With respect to any
Cross-Collateralized Mortgage Loan, as the context may require, "Mortgaged
Property" may mean, collectively, all the Mortgaged Properties securing such
Cross-Collateralized Mortgage Loan.
"Mortgagor": The obligor or obligors on a Mortgage Note, including without
limitation, any Person that has acquired the related Mortgaged Property and
assumed the obligations of the original obligor under the Mortgage Note.
"Net Aggregate Prepayment Interest Shortfall": With respect to any
Distribution Date, the amount, if any, by which (a) the aggregate of all
Prepayment Interest Shortfalls incurred in connection with the receipt of
Principal Prepayments on the Mortgage Loans during the related Collection
Period, exceeds (b) the aggregate amount deposited by the Master Servicer in the
Distribution Account for such Distribution Date pursuant to Section 3.19(f) in
connection with such Prepayment Interest Shortfalls.
"Net Default Interest": With respect to any Mortgage Loan, any Default
Interest actually collected thereon, net of any portion thereof allocable to pay
the Special Servicer any Liquidation Fee or Workout Fee in respect of such
Mortgage Loan and further net of any Advance Interest accrued on Advances made
in respect of such Mortgage Loan and reimbursable from such Default Interest in
accordance with Section 3.05(a).
"Net Investment Earnings": With respect to any of the Certificate Account,
the Distribution Account, the REO Account or the Interest Reserve Account 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
relating to the Trust Fund 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 any of the Certificate Account, the
Distribution Account, the REO Account or the Interest Reserve Account 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 relating to the Trust Fund held in such account
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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 REO Loan, as of
any date of determination, a rate per annum equal to the related Mortgage Rate
then in effect, minus the Servicing Fee Rate but for purposes of calculating the
REMIC I Remittance Rate, the REMIC II Remittance Rate, and Weighted Average Net
Mortgage Rate, determined without regard to any modification, waiver or
amendment of the terms of such Mortgage Loan, whether agreed to by the Master
Servicer or Special Servicer or resulting from (i) the bankruptcy, insolvency or
similar proceeding involving the related Mortgagor or (ii) the application of
the Revised Rate to any ARD Loan and, with respect to any Mortgage Loan that
does not accrue interest on the basis of a 360-day year consisting of twelve
30-day months, the Net Mortgage Rate of such Mortgage Loan for such purposes for
any one-month preceding a related Due Date will be the annualized rate at which
interest would have to accrue in respect of such loan on the basis of a 360-day
year consisting of twelve 30-day months in order to produce the aggregate amount
of interest actually accrued in respect of such loan during such one-month
period at the related Mortgage Rate (net of the related Servicing Fee Rate);
provided, however, that with respect to the Interest Reserve Loans, (i) the Net
Mortgage Rate for the Collection Period preceding the Due Dates in (a) January
of each calendar year that is not a leap year and (b) February of each calendar
year, will be determined net of the Withheld Amounts and (ii) the Net Mortgage
Rate for the Collection Period preceding the Due Dates in March of each calendar
year will be determined after taking into account the addition of the Withheld
Amounts.
"Net Operating Income": With respect to any Mortgaged Property, for any
specified period, the net operating income calculated in accordance with Exhibit
G using the methodologies set forth in Exhibit F.
"Nonrecoverable Advance": Any Nonrecoverable Delinquency Advance or
Nonrecoverable Servicing Advance.
"Nonrecoverable Delinquency Advance": Any Delinquency Advance previously
made or proposed to be made in respect of a Mortgage Loan or REO Loan which, in
the judgment of the Master Servicer or, if applicable, the Trustee or the Fiscal
Agent, will not be ultimately recoverable (together with Advance Interest
thereon) from late payments, Insurance Proceeds or Liquidation Proceeds, or any
other recovery on or in respect of such Mortgage Loan or REO Loan. The
determination by the Master Servicer or, if applicable, the Trustee or the
Fiscal Agent, that it has made a Nonrecoverable Delinquency Advance or that any
proposed Delinquency Advance, if made, would constitute a Nonrecoverable
Delinquency Advance, shall be evidenced by an Officer's Certificate delivered to
the Depositor and delivered to or retained by the Trustee, detailing a
reasonable basis for such determination. The Trustee and the Fiscal Agent shall
be entitled to rely conclusively upon any such Officer's Certificate of the
Master Servicer.
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"Nonrecoverable Servicing Advance": Any Servicing Advance previously made
or proposed to be made in respect of a Mortgage Loan or REO Property which, in
the judgment of the Master Servicer, the Special Servicer or, if applicable, the
Trustee or the Fiscal Agent, will not be ultimately recoverable (together with
Advance Interest thereon) from late payments, Insurance Proceeds, Liquidation
Proceeds, or any other recovery on or in respect of such Mortgage Loan or REO
Property. The determination by the Master Servicer, the Special Servicer or, if
applicable, the Trustee or the Fiscal Agent that it has made a Nonrecoverable
Servicing Advance or that any proposed Servicing Advance, if made, would
constitute a Nonrecoverable Servicing Advance, shall be evidenced by an
Officers' Certificate delivered to the Depositor and delivered to or retained by
the Trustee, detailing a reasonable basis for such determination. The Trustee
and Fiscal Agent shall be entitled to rely conclusively upon any such Officer's
Certificate of the Master Servicer or the Special Servicer, and the Master
Servicer shall be entitled to rely conclusively upon such Officer's Certificate
of the Special Servicer.
"Non-Registered Certificate": Unless and until registered under the
Securities Act, any Class G, Class H, Class J, Class K, Class L, Class M, Class
N or Residual Certificate.
"Officer's Certificate": A certificate signed, as applicable, by a
Servicing Officer of the Master Servicer or the Special Servicer or by a
Responsible Officer of the Trustee.
"Opinion of Counsel": A written opinion of counsel, who may, without
limitation, be salaried counsel for the Depositor, the Master Servicer or the
Special Servicer, acceptable and delivered to the Trustee, except that any
opinion of counsel relating to (a) the qualification of REMIC I, REMIC II or
REMIC III as a REMIC or (b) compliance with the REMIC Provisions, must be an
opinion of counsel who is in fact Independent of the Depositor, the Master
Servicer and the Special Servicer.
"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 may have and any other
interest therein, whether direct or indirect, legal or beneficial, as owner or
as pledgee.
"Pass-Through Rate": With respect to:
(1) the Class X Certificates, (a) for the initial Distribution Date 0.442%
per annum, and (b) for any subsequent Distribution Date, the per annum
rate, expressed as a percentage, obtained by dividing (i) the sum of the
product of (a) the Uncertificated Principal Balance of each Class of REMIC
II Regular Interest immediately prior to such Distribution Date and (b) the
related Component Rate for such Distribution Date by (ii) the Class
Notional Amount.
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(2) the Class A-1 Certificates and Class A-2 Certificates, for any
Distribution Date, the respective fixed rates per annum specified as such
in the Preliminary Statement;
(3) the Class B, Class C, Class D, Class K, Class L, Class M and Class N
Certificates, for any Distribution Date, the lesser of the fixed rate per
annum specified as such in the Preliminary Statement and the Weighted
Average Net Mortgage Rate; and
(4) the Class E, Class F, Class G, Class H and Class J Certificates, for
any Distribution Date, the Weighted Average Net Mortgage Rate.
"Payment Adjustment Date": With respect to each Adjustable Rate Mortgage
Loan, any date on which the related Monthly Payment is subject to adjustment
pursuant to the related Mortgage Note. The first Payment Adjustment Date
subsequent to the Cut-off Date for each Adjustable Rate Mortgage Loan is
specified in the Mortgage Loan Schedule, and successive Payment Adjustment Dates
for such Mortgage Loan shall thereafter periodically occur with the frequency
specified in the Mortgage Loan Schedule.
"Payment Priority": With respect to any Class of Certificates, the priority
of the Holders thereof in respect of the Holders of the other Classes of
Certificates to receive distributions out of the Available Distribution Amount
for any Distribution Date, as set forth in Section 4.01(c) hereof.
"Penalty Charges": With respect to any Mortgage Loan (or successor REO
Loan), any amounts collected thereon that represent late payment charges or
Default Interest.
"Percentage Interest": With respect to any REMIC III 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 the
Certificate Notional Amount of such Certificate as of the Closing Date, as
specified on the face thereof, and the denominator of which is the Initial Class
Principal Balance or Initial Class Notional Amount 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": Securities, instruments, or security entitlements
with respect to one or more of the following:
(1) obligations of or guaranteed as to principal and interest by the United
States or any agency or instrumentality thereof when such obligations are
backed by the full faith and credit of the United States;
(2) repurchase agreements on obligations specified in clause (i) maturing
not more than 30 days from the date of acquisition thereof, provided that
the unsecured obligations
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of the party agreeing to repurchase such obligations are at the time rated
by each Rating Agency in its highest short-term rating available;
(3) federal funds, unsecured certificates of deposit, time deposits and
bankers' acceptances (which shall each have an original maturity of not
more than 90 days and, in the case of bankers' acceptances, shall in no
event have an original maturity of more than 365 days or a remaining
maturity of more than 30 days) denominated in United States dollars of any
U.S. depository institution or trust company incorporated under the laws of
the United States or any state thereof or of any domestic branch of a
foreign depository institution or trust company; provided that the
short-term debt obligations of such depository institution or trust company
at all times since the date of acquisition thereof have been rated by each
Rating Agency in its highest short-term rating available (or, if not rated
by FITCH IBCA, otherwise acceptable to FITCH IBCA as confirmed in writing
that such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current rating assigned to any
Class of Certificates by such Rating Agency);
(4) 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 which on the date of acquisition has been rated by each
Rating Agency in its highest short-term rating available (or, if not rated
by FITCH IBCA, otherwise acceptable to FITCH IBCA as confirmed in writing
that such investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current rating assigned to any
Class of Certificates by such Rating Agency); provided that such commercial
paper shall have a remaining maturity of not more than 30 days;
(5) a money market fund or a qualified investment fund rated by each Rating
Agency in its highest rating category;
(6) commercial paper of issuers rated by each Rating Agency in its highest
short-term rating available (or, if not rated by FITCH IBCA, otherwise
acceptable to FITCH IBCA as confirmed in writing that such investment would
not, in and of itself, result in a downgrade, qualification or withdrawal
of the then current rating assigned to any Class of Certificates by such
Rating Agency); provided that such obligations shall have a remaining
maturity of not more than 30 days and such obligations are limited to the
right to receive only monthly principal and interest payments;
(7) short-term debt obligations of issuers rated A-1 (or the equivalent) by
each Rating Agency (or, if not rated by FITCH IBCA, otherwise acceptable to
FITCH IBCA as confirmed in writing that such investment would not, in and
of itself, result in a downgrade, qualification or withdrawal of the then
current rating assigned to any Class of Certificates by such Rating Agency)
having a maturity of not more than 30 days; provided that the total amount
of such investment does not exceed the greater of (A) 20%
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of the then outstanding principal balance of the Certificates, and (B) the
amount of monthly principal and interest payments (other than Balloon
Payments) payable on the Mortgage Loans during the preceding Collection
Period; provided, further, and notwithstanding the preceding proviso, that
if all of the Mortgage Loans are fully amortizing, then the amount of such
investment shall not exceed the amount of monthly principal and interest
payments (other than Balloon Payments) payable on the Mortgage Loans during
the preceding Collection Period;
(8) fully Federal Deposit Insurance Corporation-insured demand and time
deposits in, or certificates of deposit of, or bankers' acceptances issued
by, any bank or trust company, savings and loan association or savings
bank, the short term obligations of which are rated in the highest short
term rating category by each Rating Agency (or, if not rated by FITCH IBCA,
otherwise acceptable to FITCH IBCA as confirmed in writing that such
investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current rating assigned to any
Class of Certificates by such Rating Agency); and
(9) other obligations or securities that are acceptable to each Rating
Agency as a Permitted Investment hereunder and which would not result in
the downgrade, qualification or withdrawal of the then-current rating
assigned to any Class of Certificates by the Rating Agency, as evidenced in
writing;
provided, however, that no instrument shall be a Permitted Investment if it
represents, (1) the right to receive only interest payments with respect to the
underlying debt instrument, (2) the right to receive both principal and interest
payments derived from obligations underlying such instrument and the principal
and interest payments with respect to such instrument provide a yield to
maturity greater than 120% of the yield to maturity at par of such underlying
obligations, (3) an obligation that has a remaining maturity of greater than 365
days from the date of acquisition thereof. References herein to the highest
rating available on money market funds shall mean Aaa in the case of Moody's and
AAA in the case of FITCH IBCA, and references herein to the highest rating
available on unsecured commercial paper and short-term debt obligations shall
mean P-1 in the case of Moody's and F-1+ in the case of FITCH IBCA.
"Permitted Transferee": Any Transferee other than (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 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
(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(a)(2)(C) of the Code, (v) any electing large partnership under
Section
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775 of the Code and (vi) any other Person so designated by the Trustee based
upon an Opinion of Counsel that the holding of an Ownership Interest in a
Residual Certificate by such Person may cause the Trust Fund or any Person
having an Ownership Interest in any Class of Certificates (other than such
Person) to incur a liability for any federal tax imposed under the Code that
would not otherwise be imposed but for the Transfer of an Ownership Interest in
a Residual Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
"Person": Any legal person, including, without limitation, any individual,
corporation, partnership, limited liability company, joint venture, association,
joint-stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof.
"Plan": As defined in Section 5.02.
"Preliminary Statement": The introductory section in this Agreement found
on pages 1 through 3 hereof.
"Prepayment Assumption": A CPR of 0%, used for determining the accrual of
original issue discount, market discount and premium, if any, on the REMIC I
Regular Interests, the REMIC II Regular Interests and the Certificates for
federal income tax purposes.
"Prepayment Interest Excess": With respect to any Mortgage Loan that was
subject to a Principal Prepayment in full or in part during any Collection
Period, which Principal Prepayment was applied to such Mortgage Loan following
such Mortgage Loan's Due Date in such Collection Period, the amount of interest
(net of related Master Servicing Fees) accrued on the amount of such Principal
Prepayment during the period from and after such Due Date, to the extent
collected (without regard to any Prepayment Premium that may have been
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
that would have accrued at the related Net Mortgage 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, to the extent not collected from
the related Mortgagor (without regard to any Prepayment Premium that may have
been collected).
"Prepayment Premium": Any premium, penalty or fee paid or payable, as the
context requires, by a Mortgagor in connection with a Principal Prepayment on,
or other early collection of principal of, a Mortgage Loan or REO Loan.
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"Primary Servicing Office": With respect to each of the Master Servicer and
the Special Servicer, the office thereof primarily responsible for performing
its respective duties under this Agreement; initially located in Illinois, in
the case of the Master Servicer, and California, in the case of the Special
Servicer.
"Principal Allocation Fraction": With respect to any Distribution Date and
each of Class A-1, Class A-2, Class B, Class C, Class D, Class E, Class F and
Class G Certificates, a fraction the numerator of which is the Principal
Distribution Amount allocable to such Class of Certificate for such Distribution
Date and the denominator of which is the Principal Distribution Amount for all
Classes of Certificates as of such Distribution Date.
"Principal Balance Certificate": Any REMIC III Regular Certificate other
than a Class X Certificate.
"Principal Distribution Amount": With respect to any Distribution Date, the
aggregate of (i) the Current Principal Distribution Amount for such Distribution
Date and (ii), if such Distribution Date is after the initial Distribution Date,
the excess, if any, of the Principal Distribution Amount for the preceding
Distribution Date, over the aggregate distributions of principal made on the
Principal Balance Certificates in respect of such Principal Distribution Amount
on the preceding Distribution Date.
"Principal Prepayment": Any payment of principal made by the Mortgagor on a
Mortgage Loan which is received in advance of its scheduled Due Date and which
is not 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.
"Private Book-Entry Certificate": Any Class G and Class H Certificate
registered in the name of the Depository or its nominee.
"Proposed Plan": As defined in Section 3.17(a)(iii).
"Prospectus": The Prospectus dated December 17, 1997, as supplemented by
the Prospectus Supplement dated April 28, 1998, relating to the offering of the
Certificates.
"PTCE 95-60": As defined in Section 5.02(c)(ii).
"Purchase Price": With respect to any Mortgage Loan, a 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 in effect from time to time to but not including the Due
Date in the Collection Period of purchase , (b) all related unreimbursed
Servicing Advances, and (c) if such Mortgage Loan is being purchased by a
Mortgage Loan Seller pursuant to Section 6 of the related Mortgage Loan Purchase
Agreement, all expenses reasonably incurred or to be incurred by the Master
Servicer (unless
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such Mortgage Loan Seller is acting as Master Servicer), the Depositor and the
Trustee in respect of the Breach or Defect giving rise to the repurchase
obligation. With respect to any REO Property, the amount calculated in
accordance with the preceding sentence in respect of the related REO Loan.
"Qualified Appraiser": In connection with the appraisal of any Mortgaged
Property or REO Property, an Independent MAI-designated appraiser or state
certified appraiser.
"Qualified Insurer": An insurance company or security or bonding company
qualified to write the related Insurance Policy in the relevant jurisdiction.
"Qualifying Substitute Mortgage Loan" means, in the case of a Deleted
Mortgage Loan, a Mortgage Loan which, on the date of substitution, (i) has a
principal balance, after deduction of the principal portion of the Monthly
Payment due in the month of substitution, not in excess of the Stated Principal
Balance of the Deleted Mortgage Loan; (ii) is accruing interest at a rate of
interest at least equal to that of the Deleted Mortgage Loan; (iii) has a fixed
Mortgage Rate if the Deleted Mortgage Loan is a Fixed Rate Mortgage Loan and an
adjustable Mortgage Rate (with the same Index, Gross Margin and frequency of
Interest Rate Adjustment Dates and Payment Adjustment Dates as the Deleted
Mortgage Loan) if the Deleted Mortgage Loan is an Adjustable Rate Mortgage Loan;
(iv) is accruing interest on the same basis (for example, a 360-day year
consisting of twelve 30-day months) as the Deleted Mortgage Loan; (v) has a
remaining term to stated maturity not greater than, and not more than two years
less than, that of the Deleted Mortgage Loan; (vi) has an original Loan-to-Value
Ratio not higher than that of the Deleted Mortgage Loan and a current
Loan-to-Value Ratio (equal to the principal balance on the date of substitution
divided by its Appraised Value as determined by an Appraisal dated not more than
twelve months prior to the date of substitution) not higher than the then
current Loan-to-Value Ratio of the Deleted Mortgage Loan; (vii) will comply with
all of the representations and warranties relating to Mortgage Loans set forth
in the related Mortgage Loan Purchase Agreement, as of the date of substitution;
(viii) has an Environmental Assessment relating to the related Mortgaged
Property in its Servicing File; and (ix) as to which the Trustee has received an
Opinion of Counsel, at the related Seller's expense, that such Mortgage Loan is
a "qualified replacement mortgage" within the meaning of Section 860G(a)(4) of
the Code; provided that no Mortgage Loan may have a Maturity Date after the date
three years prior to the Rated Final Distribution Date, and provided, further,
that no such Mortgage Loan shall be substituted for a Deleted Mortgage Loan
unless Rating Agency Confirmation is obtained. In the event that either one
mortgage loan is substituted for more than one Deleted Mortgage Loan or more
than one mortgage loan is substituted for one or more Deleted Mortgage Loans,
then (a) the principal balance referred to in clause (i) above shall be
determined on the basis of aggregate principal balances and (b) the rates
referred to in clauses (ii) and (iii) above and the remaining term to stated
maturity referred to in clause (v) above shall be determined on a weighted
average basis. Whenever a Qualifying Substitute Mortgage Loan is substituted for
a Deleted Mortgage Loan pursuant to this Agreement, the party effecting such
substitution shall certify that such
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Mortgage Loan meets all of the requirements of this definition and shall send
such certification to the Trustee.
"Rated Final Distribution Date": The Distribution Date in May 2030.
"Rating Agency": Each of Moody's and FITCH IBCA.
"Rating Agency Confirmation": With respect to any matter, where required
under this Agreement, confirmation in writing by each Rating Agency that a
proposed action, failure to act, or other event specified herein will not in and
of itself result in the withdrawal, downgrade, or qualification of the rating
assigned by such Rating Agency to any Class of Certificates then rated by such
Rating Agency.
"Realized Loss": With respect to each defaulted Mortgage Loan as to which a
Final Recovery Determination has been made, or with respect to any 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 (i) 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 (ii) all accrued but unpaid interest on such Mortgage Loan or REO
Loan, as the case may be (without taking into account the amounts described in
subclause (iv) of this sentence), at the related Mortgage Rate to but not
including the Due Date in the Collection Period in which the Final Recovery
Determination was made, plus (iii) 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 (iv) all payments and proceeds, if any,
received in respect of such Mortgage Loan or REO Loan, as the case may be,
during the Collection Period in which such Final Recovery Determination was made
(net of any related Liquidation Expenses paid therefrom).
With respect to any Mortgage Loan as to which any portion of the
outstanding principal or accrued interest owed thereunder was forgiven 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 Master Servicer or Special Servicer pursuant to Section
3.20, the amount of such principal or interest so forgiven.
With respect to any Mortgage Loan as to which the Mortgage Rate thereon has
been permanently reduced 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 Master Servicer or
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.
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"Record Date": With respect to any Distribution Date, the last Business Day
of the calendar month immediately preceding the month in which such Distribution
Date occurs.
"Registered Certificates": The Class X, Class A-1, Class A-2, Class B,
Class C, Class D, Class E and Class F Certificates.
"Reimbursement Rate": The rate per annum applicable to the accrual of
Advance Interest, which rate per annum shall be equal to the "prime rate" as
published in the "Money Rates" section of The Wall Street Journal, as such
"prime rate" may change from time to time.
"REMIC": A "real estate mortgage investment conduit" as defined in Section
860D of the Code.
"REMIC I": The segregated pool of assets subject hereto, constituting the
primary trust created hereby and to be administered hereunder, with respect to
which a REMIC election is to be made, 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 or receivable after the Cut-off Date
(other than payments of principal, interest and other amounts due and payable on
the Mortgage Loans on or before the Cut-off Date), together with all documents
delivered or caused to be delivered under the Mortgage Loan Purchase Agreements
with respect to the Mortgage Loans by the Mortgage Loan Sellers; (ii) any REO
Properties acquired in respect of the Mortgage Loans; (iii) such funds or assets
as from time to time are deposited in the Distribution Account, the Certificate
Account and the REO Account (if established); and (iv) the rights of the
Depositor under Sections 2, 4(a) and 6 of each Mortgage Loan Purchase Agreement
assigned by the Depositor to the Trustee. If a Replacement Mortgage Loan or
Loans are substituted for any Deleted Mortgage Loan, the REMIC I Regular
Interest that related to the Deleted Mortgage Loan shall thereafter relate to
such Replacement Mortgage Loan(s).
"REMIC I Regular Interest": With respect to each Mortgage Loan (and any
successor REO Loan), the separate non-certificated beneficial ownership interest
in REMIC I issued hereunder and designated as a "regular interest" in REMIC I.
Each REMIC I Regular Interest shall accrue interest at the related REMIC I
Remittance Rate 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 (which shall equal the Cut-off Date Principal
Balance of the related Mortgage Loan). The designation for each REMIC I Regular
Interest shall be the loan number for the related Mortgage Loan set forth in the
Mortgage Loan Schedule. If a Replacement Mortgage Loan or Loans are substituted
for any Deleted Mortgage Loan, the REMIC I Regular Interest that related to the
Deleted Mortgage Loan shall thereafter relate to such Replacement Mortgage
Loan(s).
"REMIC I Remittance Rate": With respect to any REMIC I Regular Interest for
any Distribution Date, a rate per annum equal to the Net Mortgage Rate in effect
for the related
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Mortgage Loan or REO Loan, as the case may be, as of the commencement of the
related Collection Period. If any Mortgage Loan included in the Trust Fund as of
the Closing Date is replaced by a Replacement Mortgage Loan or Loans, the REMIC
I Remittance Rate for the related REMIC I Regular Interest shall still be
calculated in accordance with the preceding sentence based on the Net Mortgage
Rate for the Deleted Mortgage Loan.
"REMIC II": The segregated pool of assets consisting of all of the REMIC I
Regular Interests, with respect to which a separate REMIC election is to be
made.
"REMIC II Regular Interest": Any of the 14 separate non-certificated
beneficial ownership interests in REMIC II issued hereunder designated as a
"regular interest" in REMIC II and identified individually as REMIC II Regular
Interests LA-1, LA-2, LB, LC, LD, LE, LF, LG, LH, LJ, LK, LL, LM and LN. Each
REMIC II Regular Interest shall accrue interest at the related 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 of REMIC II Regular
Interests LA-1, LA-2, LB, LC, LD, LE, LF, LG, LH, LJ, LK, LL, LM and LN, for any
Distribution Date, the weighted average of the REMIC I Remittance Rates
(weighted on the basis of the respective Uncertificated Principal Balances of
the related REMIC I Regular Interests immediately prior to such Distribution
Date).
"REMIC III": The segregated pool of assets consisting of all of the REMIC
II Regular Interests, with respect to which a separate REMIC election is to be
made.
"REMIC III Certificate": Any Certificate, other than a Class R-I or Class
R-II Certificate.
"REMIC III Regular Certificate": Any REMIC III Certificate, other than a
Class R-III Certificate.
"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
temporary and final Treasury regulations (and, to the extent not inconsistent
with such temporary and final regulations, proposed regulations) and any
published rulings, notices and announcements, promulgated thereunder, as the
foregoing may be in effect from time to time.
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"Rents from Real Property": With respect to any REO Property, gross income
of the character described in Section 856(d) of the Code, which income, subject
to the terms and conditions of that Section of the Code in its present form,
does not include:
(i) except as provided in Section 856(d)(4) or (6) of the Code, any
amount received or accrued, directly or indirectly, with respect to such
REO Property, if the determination of such amount depends in whole or in
part on the income or profits derived by any Person from such property
(unless such amount is a fixed percentage or percentages of receipts or
sales and otherwise constitutes Rents from Real Property);
(ii) any amount received or accrued, directly or indirectly, from any
Person if the Trust Fund owns directly or indirectly (including by
attribution) a ten percent or greater interest in such Person determined in
accordance with Sections 856(d)(2)(B) and (d)(5) of the Code;
(iii) any amount received or accrued, directly or indirectly, with
respect to such REO Property if any Person Directly Operates such REO
Property;
(iv) any amount charged for services that are not customarily
furnished in connection with the rental of property to tenants in buildings
of a similar class in the same geographic market as such REO Property
within the meaning of Treasury Regulations Section 1.856-4(b)(1) (whether
or not such charges are separately stated); and
(v) rent attributable to personal property unless such personal
property is leased under, or in connection with, the lease of such REO
Property and, for any taxable year of the Trust Fund, such rent is no
greater than 15 percent of the total rent received or accrued under, or in
connection with, the lease.
"REO Account": A segregated account or accounts created and maintained by
the Special Servicer pursuant to Section 3.16 (b) on behalf of the Trustee in
trust for the Certificateholders, which shall be entitled "GMAC Commercial
Mortgage Corporation, as Special Servicer, in trust for registered holders of
GMAC Commercial Mortgage Securities, Inc., Mortgage Pass-Through Certificates,
Series 1998-C1.
"REO Acquisition": The acquisition of any REO Property pursuant to Section
3.09.
"REO Disposition": The sale or other disposition of the REO Property
pursuant to Section 3.18.
"REO Extension": As defined in Section 3.16(a).
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"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 the applicable Assumed
Monthly Payment and otherwise to have the same terms and conditions as its
predecessor Mortgage Loan, including, without limitation, with respect to the
calculation of the Mortgage Rate in effect from time to time (such terms and
conditions to be applied without regard to the default on such predecessor
Mortgage Loan). Each REO Loan shall be deemed to have an initial outstanding
principal balance and Stated Principal Balance equal to the outstanding
principal balance and Stated Principal Balance, respectively, of its predecessor
Mortgage Loan as of the date of the related REO Acquisition. All Monthly
Payments (other than a Balloon Payment), Assumed Monthly Payments and other
amounts 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. All amounts payable or reimbursable to the Master
Servicer, the Special Servicer, the Trustee or the Fiscal Agent in respect of
the predecessor Mortgage Loan as of the date of the related REO Acquisition,
including, without limitation, any unreimbursed Advances, together with any
Advance Interest accrued and payable in respect of such Advances, shall continue
to be payable or reimbursable to the Master Servicer, the Special Servicer, the
Trustee or the Fiscal Agent, as the case may be, in respect of an REO Loan.
"REO Loan Accrual Period": With respect to any REO Loan and any Due Date
therefor, the one month period immediately preceding such Due Date.
"REO Property": A Mortgaged Property acquired by the Special Servicer 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 and profits derived from the ownership,
operation or leasing of any REO Property.
"REO Status Report": A report or reports substantially in the form of
Exhibit H attached hereto setting forth, among other things, with respect to
each REO Property that was included in the Trust Fund as of the close of
business on the immediately preceding Determination Date, (i) the Acquisition
Date of such REO Property, (ii) the amount of income collected with respect to
any REO Property (net of related expenses) and other amounts, if any, received
on such REO Property during the Collection Period ending on such Determination
Date and (iii) the value of the REO Property based on the most recent Appraisal
or other valuation thereof available to the Master Servicer as of such date of
determination (including any valuation prepared internally by the Special
Servicer).
"REO Tax": As defined in Section 3.17(a)(i).
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"Replacement Mortgage Loan": means any Qualifying Substitute Mortgage Loan
that is substituted for one or more Deleted Mortgage Loans.
"Request for Release": A release signed by a Servicing Officer, in the form
of Exhibit D attached hereto.
"Required Appraisal Loan": As defined in Section 3.19(d).
"Reserve Account": The account or accounts created and maintained pursuant
to Section 3.03(d).
"Reserve Funds": With respect to any Mortgage Loan, any cash amounts or
instruments convertible into cash delivered by the related Mortgagor to be held
in escrow by or on behalf of the mortgagee representing reserves for repairs,
replacements, capital improvements and/or environmental testing and remediation
with respect to the related Mortgaged Property.
"Residual Certificate": Any Class R-I, Class R-II or Class R-III
Certificate.
"Responsible Officer": When used with respect to the initial Trustee, any
officer of its Asset-Backed Securities Trust Services Group with direct
responsibility for the transaction contemplated by this Agreement and with
respect to any successor Trustee, any vice president, any assistant vice
president, any assistant secretary, any assistant treasurer, any trust officer
or assistant trust officer, or any assistant controller in its corporate trust
department or any other 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.
"Revised Rate": With respect to each ARD Loan, the increased interest rate
after the Anticipated Repayment Date (in the absence of a default) for such ARD
Loan, as calculated and as set forth in the related Mortgage Note or Mortgage,
but in no event shall such rate exceed a rate equal to the applicable initial
Mortgage Rate plus 2.00%.
"Securities Act": The Securities Act of 1933, as amended.
"Security Agreement": With respect to any Mortgage Loan, any security
agreement or equivalent instrument, whether contained in the related Mortgage or
executed separately, creating in favor of the holder of such Mortgage a security
interest in the personal property constituting security for repayment of such
Mortgage Loan.
"Senior Certificate": Any Class X, Class A-1 or Class A-2 Certificate.
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"Senior Living Consultant": With respect to the Senior Living Loan, any
consultant or successor thereto designated pursuant to Section 215 of the Senior
Living Trust Agreement.
"Senior Living Loan": The Mortgage Loan identified as "GMAC 1010" on the
Mortgage Loan Schedule.
"Senior Living Surety": ZC Specialty Insurance Company, as issuer of the
Senior Living Surety Bond.
"Senior Living Surety Bond" The surety bond issued by the Senior Living
Surety issuing a portion of principal of and interest on the Senior Living Loan.
"Senior Living Trust Agreement": With respect to the Senior Living Loan,
the Amended and Restated Trust Agreement, dated as of April 1, 1998, among
Senior Living Properties LLC, SLP Illinois, LLC, ZC Specialty Insurance Company,
GMAC Commercial Mortgage Corporation, HCFP Funding, Inc., Complete Care
Services, L.P. and The First National Bank of Chicago, as trustee.
"Senior Living Subrogation Agreement": With respect to the Senior Living
Loan, the Subrogation and Note Purchase Agreement, dated February 6, 1998,
between GMAC Commercial Mortgage Corporation and ZC Specialty Insurance Company,
as amended by the First Amendment to the Subrogation and Note Purchase
Agreement, dated April 1, 1998, between GMAC Commercial Mortgage Corporation and
ZC Specialty Insurance Company.
"Servicer Watch List": A report or reports setting forth, among other
things, certain Mortgage Loans that (i) have experienced a decrease of at least
10% in debt service coverage from the previous reporting period (unless the
Master Servicer shall have reasonably determined that such decrease is due to
the seasonal nature or use of the related Mortgaged Property), (ii) have
experienced a loss of or bankruptcy of the largest tenant (to the extent the
Servicer has actual knowledge of such loss or bankruptcy) or (iii) are within
six months of maturity.
"Servicing Account": The account or accounts created and maintained
pursuant to Section 3.03(a).
"Servicing Advances": All customary, reasonable and necessary "out of
pocket" costs and expenses (including attorneys' fees and expenses and fees of
real estate brokers) incurred by the Master Servicer, the Special Servicer or,
if applicable, the Trustee or the Fiscal Agent in connection with the servicing
and administering of (a) a Mortgage Loan in respect of which a default,
delinquency or other unanticipated event has occurred or as to which a default
is imminent or (b) an REO Property, including, but not limited to, the cost of
(i) compliance with the obligations of the Master Servicer and/or the Special
Servicer set forth in Section
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3.03(c) and 3.09(c), (ii) the preservation, restoration and protection of a
Mortgaged Property, (iii) obtaining any Insurance Proceeds or any Liquidation
Proceeds in respect of any Mortgage Loan or REO Property, (iv) any enforcement
or judicial proceedings with respect to a Mortgaged Property, including
foreclosures, and (v) the operation, management, maintenance and liquidation of
any REO Property. All Emergency Advances made by the Special Servicer hereunder
shall be considered "Servicing Advances" for the purposes hereof.
"Servicing Fee Rate": With respect to any Mortgage Loan, the percentage
rate per annum set forth with respect to such Mortgage Loan on the Mortgage Loan
Schedule.
"Servicing Fees": With respect to each Mortgage Loan and REO Loan, the
Master Servicing Fee, the Trustee Fee and the Special Servicing Fee (if
applicable).
"Servicing Officer": Any officer 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 the Master Servicer or the Special Servicer to
the Trustee and the Depositor on the Closing Date as such list may be amended
from time to time thereafter.
"Servicing Return Date": With respect to any Corrected Mortgage Loan, the
date that servicing thereof is returned by the Special Servicer to the Master
Servicer pursuant to Section 3.21(a).
"Servicing Standard": As defined in Section 3.01(a).
"Servicing Transfer Event": With respect to any Mortgage Loan, the
occurrence of any of the events described in clauses (1) through (8) of the
definition of "Specially Serviced Mortgage Loan".
"Special Servicer": GMACCM, or any successor special servicer appointed as
herein provided.
"Special Servicing Fee": With respect to each Specially Serviced Mortgage
Loan and REO Loan, the fee designated as such and payable to the Special
Servicer pursuant to Section 3.11(c).
"Special Servicing Fee Rate": With respect to each Specially Serviced
Mortgage Loan and REO Loan, 0.250% per annum.
"Specially Serviced Mortgage Loan": Any Mortgage Loan as to which any of
the following events has occurred:
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(1) the related Mortgagor has failed to make when due any Balloon Payment,
which failure has continued unremedied for 30 days; or
(2) the related Mortgagor has failed to make when due any Monthly Payment
(other than a Balloon Payment) or any other payment required under the
related Mortgage Note or the related Mortgage, which failure continues
unremedied for 60 days; or
(3) if the Master Servicer has determined in its good faith and reasonable
judgment, that a default in the making of a Monthly Payment or any other
payment required under the related Mortgage Note or the related Mortgage is
likely to occur within 30 days and is likely to remain unremedied for at
least 60 days or, in the case of a Balloon Payment, for at least 30 days;
or
(4) there shall have occurred a default, other than as described in clause
(1) or (2) above, that materially impairs the value of the related
Mortgaged Property as security for the Mortgage Loan or otherwise
materially and adversely affects the interests of Certificateholders, which
default has continued unremedied for the applicable grace period under the
terms of the Mortgage Loan (or, if no grace period is specified, 60 days);
or
(5) 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, marshalling 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
(6) the related Mortgagor shall have consented to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of
debt, marshalling 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
(7) the related Mortgagor shall have admitted in writing its inability to
pay its debts generally as they become due, filed a petition to take
advantage of any applicable insolvency or reorganization statute, made an
assignment for the benefit of its creditors, or voluntarily suspended
payment of its obligations; or
(8) the Master Servicer shall have received notice of the commencement of
foreclosure or similar proceedings with respect to the related Mortgaged
Property;
provided that a Mortgage Loan will cease to be a Specially Serviced Mortgage
Loan, when a Liquidation Event has occurred in respect of such Mortgage Loan,
when the related Mortgaged
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Property or Properties become REO Property or Properties, or at such time as
such of the following as are applicable occur with respect to the circumstances
identified above that caused the Mortgage Loan to be characterized as a
Specially Serviced Mortgage Loan (and provided that no other Servicing Transfer
Event then exists):
(w) with respect to the circumstances described in clauses (1) and (2)
above, 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 (3), (5),
(6) and (7) above, such circumstances cease to exist in the good faith and
reasonable judgment of the Special Servicer;
(y) with respect to the circumstances described in clause (4) above,
such default is cured; and
(z) with respect to the circumstances described in clause (8) above,
such proceedings are terminated.
"Startup Day": With respect to each of REMIC I, REMIC II and REMIC III, the
day designated as such in Section 10.01(b).
"Stated Maturity Date": With respect to any Mortgage Loan, the Due Date on
which the last payment of principal is due and payable under the terms of the
related 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 Master Servicer or
Special Servicer pursuant to Section 3.20.
"Stated Principal Balance": With respect to any Mortgage Loan (and any
related REO Loan), the Cut-off Date Balance of such Mortgage Loan (or in the
case of a Replacement Mortgage Loan, as of the related date of substitution), as
reduced on each Distribution Date (to not less than zero) by (i) all payments
(or Delinquency Advances in lieu thereof) of, and all other collections
allocated as provided in Section 1.02 to, principal of or with respect to such
Mortgage Loan (or related REO Loan) that are (or, if they had not been applied
to cover any Additional Trust Fund Expense, 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 related 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
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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 or Residual
Certificate.
"Substitution Shortfall Amount": means, in connection with the substitution
of one or more Replacement Mortgage Loans for one or more Deleted Mortgage
Loans, the amount, if any, by which the Purchase Price or aggregate Purchase
Price, as the case may be, for such Deleted Mortgage Loan(s) exceeds the initial
Stated Principal Balance or aggregate Stated Principal Balance, as the case may
be, of such Replacement Mortgage Loan(s).
"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 and any Sub-Servicer relating to servicing and
administration of Mortgage Loans as provided in Section 3.22.
"Surety": With respect to the Senior Living Loan and the Surety Bond, ZC
Specialty Insurance Company, a Texas corporation, and its permitted successors
thereunder.
"Surety Bond": With respect to the Senior Living Loan, the Insurance Surety
Bond, dated February 6, 1998, issued by the Surety.
"Tax Returns": The federal income tax return on Internal Revenue Service
Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax Return,
including Schedule Q thereto, Quarterly Notice to Residual Interest Holders of
REMIC Taxable Income or Net Loss Allocation, or any successor forms, to be filed
on behalf of each of REMIC I, REMIC II and REMIC III due to its classification
as a REMIC under the REMIC Provisions, together with any and all other
information, reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or any other
governmental taxing authority under any applicable provisions of federal, or
Applicable State Law.
"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.
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"Trust Fund": Collectively, all of the assets of REMIC I, REMIC II and
REMIC III.
"Trustee": LaSalle National Bank, its successor in interest, or any
successor trustee appointed as herein provided.
"Trustee Fee": With respect to each Collection Period, an amount equal to
one-twelfth of the product of the Trustee Fee Rate and the aggregate Stated
Principal Balance of the Mortgage Pool as of the commencement of such Collection
Period.
"Trustee Fee Rate": 0.00275%
"UCC": As defined in Section 3.06(a).
"UCC Financing Statement": A financing statement executed and filed
pursuant to the Uniform Commercial Code, as in effect in the relevant
jurisdiction, or, in the case of Louisiana, the comparable provisions of
Louisiana law.
"Uncertificated Accrued Interest": With respect to any REMIC I Regular
Interest, for any Distribution Date, one month's interest (calculated on the
basis of a 360-day year consisting of twelve 30-day months or, if the related
Mortgage Loan or REO Loan accrues interest on a different basis, on such
alternative basis) at the REMIC I Remittance Rate applicable to such REMIC I
Regular Interest for such Distribution Date, accrued on the Uncertificated
Principal Balance of such REMIC I Regular Interest outstanding immediately prior
to such Distribution Date. With respect to any REMIC II Regular Interest, for
any Distribution Date, one month's interest (calculated on the basis of a
360-day year consisting of twelve 30-day months) at the REMIC II Remittance Rate
applicable to such REMIC II Regular Interest for such Distribution Date, accrued
on the Uncertificated Principal Balance of such REMIC II Regular Interest
outstanding immediately prior to such Distribution Date. The Uncertificated
Accrued Interest in respect of any REMIC I Regular Interest or REMIC II Regular
Interest for any Distribution Date shall be deemed to accrue during the
applicable Interest Accrual Period.
"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,
expressed as a percentage, 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, an amount
equal to: (a) the Uncertificated Accrued Interest in respect of such REMIC II
Regular Interest for such Distribution Date; reduced (to not less
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than zero) by (b) the portion, if any, of the Net Aggregate Prepayment Interest
Shortfall, if any, for such Distribution Date allocated to such REMIC II Regular
Interest which shall be allocated in the same manner as such Net Aggregate
Prepayment Interest Shortfall is allocated amongst the corresponding REMIC III
Regular Certificates.
"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 Principal Balance of
the related Mortgage Loan. On each Distribution Date, the Uncertificated
Principal Balance of each REMIC I Regular Interest shall be reduced by all
distributions of principal deemed to have been made thereon on such Distribution
Date pursuant to Section 4.01(a) and, if and to the extent appropriate, shall be
further reduced on such Distribution Date as provided in Section 4.04(a). As of
the Closing Date, the Uncertificated Principal Balance of each REMIC II Regular
Interest shall equal the amount set forth in the Preliminary Statement hereto as
its initial Uncertificated Principal Balance. On each Distribution Date, the
Uncertificated Principal Balance of each such REMIC II Regular Interest shall be
reduced by all distributions of principal deemed to have been made thereon on
such Distribution Date pursuant to Section 4.01(b) and, if and to the extent
appropriate, shall be further reduced on such Distribution Date as provided in
Section 4.04(b).
"Underwriter": Each of Deutsche Morgan Grenfell Inc. and Lehman Brothers
Inc.
"Uninsured Cause": Any cause of damage to property subject to a Mortgage
such that the complete restoration of such property is not fully reimbursable by
the hazard insurance policies or flood insurance policies required to be
maintained pursuant to Section 3.07.
"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 (except, in the
case of a partnership, to the extent provided in Treasury regulations), 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 for which a court within the United States is able to exercise primary
supervision over its administration and for which one or more United States
Persons have the authority to control all substantial decisions of the trust.
"USPAP": The Uniform Standards of Professional Appraisal Practices.
"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, 98% of the Voting Rights shall be allocated among the Holders
of the various outstanding Classes of Principal Balance Certificates in
proportion to the respective Class Principal Balances of their
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Certificates, 1% of the Voting Rights shall be allocated among the Holders of
the Class X Certificates in proportion to the respective Class Notional Amount
of such Certificates, and the remaining Voting Rights shall be allocated equally
among the holders of the respective Classes of the Residual Certificates. Voting
Rights allocated to a Class of Certificateholders shall be allocated among such
Certificateholders in proportion to the Percentage Interests evidenced by their
respective Certificates. Appraisal Reduction Amounts will be allocated in
reduction of the respective Certificate Balances of the Class N, Class M, Class
L, Class K, Class J, Class H, Class G, Class F, Class E, Class D, Class C, Class
B and Class A Certificates, in that order, for purposes of calculating Voting
Rights.
"Weighted Average Net Mortgage Rate" means, as of any Distribution Date,
the REMIC II Remittance Rate.
"Withheld Amount": With respect to (a) each Interest Reserve Loan and (b)
each Distribution Date occurring in (i) January of each calendar year that is
not a leap year and (ii) February of each calendar year, an amount equal to one
day's interest at the related Mortgage Rate (less the Servicing Fee Rate) as of
the Cut-off Date on the respective Stated Principal Balance as of the Due Date
in the month preceding the month in which such Distribution Date occurs, to the
extent that a Monthly Payment or Delinquency Advance is made in respect thereof.
"Workout Fee": With respect to each Corrected Mortgage Loan, the fee
designated as such and payable to the Special Servicer pursuant to the third
paragraph of Section 3.11(c).
"Workout Fee Rate": With respect to each Corrected Mortgage Loan as to
which a Workout Fee is payable, 1.00%.
SECTION 1.02 Certain Calculations in Respect of the Mortgage Pool.
(a) All amounts collected in respect of any group of related Cross-
Collateralized Mortgage Loans in the form of payments from Mortgagors, Insurance
Proceeds and Liquidation Proceeds, shall be applied by the Master Servicer among
such Mortgage Loans in accordance with the express provisions of the related
loan documents and, in the absence of such express provisions, on a pro rata
basis in accordance with the respective amounts then "due and owing" as to each
such Mortgage Loan. All amounts collected in respect of any Mortgage Loan
(whether or not such Mortgage Loan is a Cross-Collateralized Mortgage Loan) in
the form of payments from Mortgagors, Liquidation Proceeds or Insurance Proceeds
shall be applied to 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 and, in the absence of such express provisions, shall be applied
for purposes of this Agreement: first, as a recovery of any related
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unreimbursed Servicing Advances and, if applicable, unpaid Liquidation Expenses;
second, as a recovery of accrued and unpaid interest at the related Mortgage
Rate on such Mortgage Loan to but not including, as appropriate, the date of
receipt or, in the case of a full Monthly Payment from any Mortgagor, the
related Due Date; third, as a recovery of principal of such Mortgage Loan then
due and owing, including, without limitation, by reason of acceleration of the
Mortgage Loan following a default thereunder (or, if a Liquidation Event has
occurred in respect of such Mortgage Loan, as a recovery of principal to the
extent of its entire remaining unpaid principal balance); fourth, as a recovery
of amounts to be currently applied to the payment of, or escrowed for the future
payment of, real estate taxes, assessments, insurance premiums, ground rents (if
applicable) and similar items; fifth, as a recovery of Reserve Funds to the
extent then required to be held in escrow; sixth, as a recovery of any
Prepayment Premium then due and owing under such Mortgage Loan; seventh, as a
recovery of any Penalty Charges then due and owing under such Mortgage Loan;
eighth, as a recovery of any other amounts then due and owing under such
Mortgage Loan; and ninth, as a recovery of any remaining principal of such
Mortgage Loan to the extent of its entire remaining unpaid principal balance.
(b) Collections in respect of each REO Property (exclusive of amounts to be
applied to the payment of the costs of operating, managing, maintaining and
disposing of such REO Property) shall be treated: first, as a recovery of any
related unreimbursed Servicing Advances; second, as a recovery of accrued and
unpaid interest on the related REO Loan at the related Mortgage Rate to but not
including the Due Date in the Collection Period of receipt; third, as a recovery
of principal of the related REO Loan to the extent of its entire unpaid
principal balance; and fourth, as a recovery of any other amounts deemed to be
due and owing in respect of the related REO Loan.
(c) The foregoing applications of amounts received in respect of any
Mortgage Loan or REO Property shall be determined by the Master Servicer in its
good faith judgment.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01 Establishment of Trust; Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery hereof,
does hereby establish a trust, appoint the Trustee to serve as trustee of such
trust and assign to the Trustee without recourse for the benefit of the
Certificateholders all the right, title and interest of the Depositor, including
any security interest therein for the benefit of the Depositor, in, to and under
(i) the Mortgage Loans identified on the Mortgage Loan Schedule, (ii) Sections
2, 4(a) and 6 of each Mortgage Loan Purchase Agreement and (iii) all other
assets included or to be included in REMIC I. Such assignment includes all
interest and principal received or receivable on or with respect to the Mortgage
Loans (other than payments of principal and interest due and payable on the
Mortgage Loans on or before 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 subsection
(a) above, the Depositor shall direct, and hereby represents and warrants that
it has directed, each Mortgage Loan Seller pursuant to the related Mortgage Loan
Purchase Agreement to deliver to and deposit with, or cause to be delivered to
and deposited with, the Trustee or a Custodian appointed thereby (with a copy to
the Master Servicer), on or before the Closing Date, the Mortgage File for each
of such Mortgage Loan Seller's Mortgage Loans so assigned. If the related
Mortgage Loan Seller cannot deliver, or cause to be delivered as to any Mortgage
Loan, the original Mortgage Note, the Mortgage Loan Seller shall deliver a copy
or duplicate original of such Mortgage Note, together with an affidavit
certifying that the original thereof has been lost or destroyed. If the related
Mortgage Loan Seller cannot deliver, or cause to be delivered, as to any
Mortgage Loan, any of the documents and/or instruments referred to in clauses
(2), (4), (11) and (12) of the definition of "Mortgage File", with evidence of
recording or filing, as the case may be, thereon, because of a delay caused by
the public recording or filing office where such document or instrument has been
delivered for recordation or filing, or because such original recorded document
has been lost or returned from the recording or filing office and subsequently
lost, as the case may be, the delivery requirements of the related Mortgage Loan
Purchase Agreement and this Section 2.01(b) shall be deemed to have been
satisfied as to such missing document or instrument, and such missing document
or instrument shall be deemed to have been included in the Mortgage File,
provided that a photocopy of such missing document or instrument (certified by
the related Mortgage Loan Seller to be a true and complete copy of the original
thereof submitted for recording or filing, as the case may be) is delivered to
the Trustee or a Custodian appointed thereby on or before the Closing Date. If
the related Mortgage Loan Seller cannot deliver, or cause to be delivered, as to
any Mortgage Loan, the original or
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a copy of the related lender's title insurance policy referred to in clause (9)
of the definition of "Mortgage File" solely because such policy has not yet been
issued, the delivery requirements of this Section 2.01(b) shall be deemed to be
satisfied as to such missing item, and such missing item shall be deemed to have
been included in the related Mortgage File, provided that the related Mortgage
Loan Seller shall have delivered to the Trustee or a Custodian appointed
thereby, on or before the Closing Date, a commitment for title insurance
"marked-up" at the closing of such Mortgage Loan, and the related Mortgage Loan
Seller shall deliver to the Trustee or such Custodian, promptly following the
receipt thereof, the original related lender's title insurance policy (or a copy
thereof). In addition, notwithstanding anything to the contrary contained
herein, if there exists with respect to any group of related
Cross-Collateralized Mortgage Loans only one original of any document referred
to in the definition of "Mortgage File" covering all the Mortgage Loans in such
group, then the inclusion of the original of such document in the Mortgage File
for any of the Mortgage Loans in such group shall be deemed an inclusion of such
original in the Mortgage File for each such Mortgage Loan. Neither the Trustee
nor any Custodian shall in any way be liable for any failure by the Mortgage
Loan Seller or the Depositor to comply with the delivery requirements of the
Mortgage Loan Purchase Agreement and this Section 2.01(b).
If any of the endorsements referred to in clause (1) of the definition of
"Mortgage File", or any of the assignments referred to in clauses (3), (5) and
(7) of the definition of "Mortgage File", are delivered to the Trustee in blank,
the Trustee shall be responsible for completing the related endorsement or
assignment in the name of the Trustee (in such capacity).
(c) Except under the circumstances provided for in the last sentence of
this subsection (c), the Trustee shall, as to each Mortgage Loan, at the expense
of the related Mortgage Loan Seller, promptly (and in any event within 45 days
of the Closing Date) cause to be submitted for recording or filing, as the case
may be, in the appropriate public office for real property records or UCC
Financing Statements, as appropriate, each assignment referred to in clauses (3)
and (5) of the definition of "Mortgage File" and each UCC-2 and UCC-3 referred
to in clause (11) (B) of the definition of "Mortgage File"; provided, however,
that each Mortgage Loan Seller shall have the right to direct the Trustee, in
writing, to cause the aforementioned recording and filing requirements to be
completed (within the specified time period) by a Person other than the Trustee,
in which case the Trustee shall (i) promptly deliver the referenced documents to
such Person for recording and filing and (ii) notify the related Mortgage Loan
Seller with respect to each Mortgage Loan for which the related assignment or
file copy of any UCC-2 and UCC-3 has not been received within the time period
specified in Section 2.02(c). Each such assignment shall reflect that it should
be returned by the public recording office to the Trustee or its designee
following recording, and each such UCC-2 and UCC-3 shall reflect that the file
copy thereof should be returned to the Trustee or its designee following filing.
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
related Mortgage Loan Seller pursuant to the related 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
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the Trustee shall upon receipt thereof cause the same to be duly recorded or
filed, as appropriate.
(d) All documents and records in the Depositor's or any Mortgage Loan
Seller's possession relating to the Mortgage Loans that are not required to be a
part of a Mortgage File in accordance with the definition thereof shall be
delivered to the Master Servicer on or before the Closing Date and shall be held
by the Master Servicer (or a Sub-Servicer retained thereby) on behalf of the
Trustee in trust for the benefit of the Certificateholders. If the Sub-Servicer
shall hold any original documents and records delivered to it pursuant to this
clause (d) then the Sub-Servicer shall deliver copies thereof to the Master
Servicer.
(e) In connection with the Depositor's assignment pursuant to subsection
(a) above, the Depositor shall deliver, and hereby represents and warrants that
it has delivered, to the Trustee and the Master Servicer, on or before the
Closing Date, a fully executed original counterpart of each Mortgage Loan
Purchase Agreement, as in full force and effect, without amendment or
modification, on the Closing Date.
SECTION 2.02 Acceptance by Trustee.
(a) The Trustee, by the execution and delivery of this Agreement,
acknowledges receipt by it or a Custodian on its behalf, subject to the
provisions of Section 2.01 and the further review provided for in this Section
2.02, and further subject to any exceptions noted on any exception report
prepared by the Trustee or such Custodian and attached hereto as Schedule II, of
the documents specified in clauses (1), (2), (3), (9) and (12) of the definition
of "Mortgage File", of a fully executed original counterpart of each Mortgage
Loan Purchase Agreement and of all other assets included in REMIC I and
delivered to it, 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 delivered or caused to be delivered by the Mortgage Loan
Sellers constituting the Mortgage Files, and that it holds and will hold such
other assets included in REMIC I, in trust for the exclusive use and benefit of
all present and future Certificateholders.
(b) Within 60 days of the Closing Date, the Trustee or a Custodian on its
behalf shall review each of the Mortgage Loan documents delivered or caused to
be delivered by the Mortgage Loan Sellers constituting the Mortgage Files; and,
promptly following such review, the Trustee shall certify in writing to each of
the Depositor, the Master Servicer, the Special Servicer and each Mortgage Loan
Seller that, as to each Mortgage Loan listed in the Mortgage Loan Schedule
(other than any Mortgage Loan paid in full or any Mortgage Loan specifically
identified in any exception report annexed thereto as not being covered by such
certification), (i) all documents specified in clauses (1), (2), (3), (9) and
(12) of the definition of "Mortgage File" are in its possession or the related
Mortgage Loan Seller has otherwise satisfied the delivery requirements in
accordance with Section 2.01(b), (ii) all documents delivered or caused to be
delivered by the related Mortgage Loan Seller constituting the related
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Mortgage File have been reviewed by it or by a Custodian on its behalf and
appear regular on their face and relate to such Mortgage Loan, and (iii) based
on such examination and only as to the foregoing documents, the information set
forth in the Mortgage Loan Schedule with respect to the items specified in
clauses (i), (ii), (iii), (iv) and (vii) of the definition of "Mortgage Loan
Schedule", is correct.
(c) The Trustee or a Custodian on its behalf shall review each of the
Mortgage Loan documents received thereby subsequent to the Closing Date; and, on
or about the first anniversary of the Closing Date, the Trustee shall certify in
writing to each of the Depositor, the Master Servicer, the Special Servicer and
each Mortgage Loan Seller that, as to each Mortgage Loan listed on the Mortgage
Loan Schedule (other than any Mortgage Loan as to which a Liquidation Event has
occurred) and except as specifically identified in any exception report annexed
to such certification), (i) all documents specified in clauses (1), (2), (9) and
(12) of the definition of "Mortgage File" are in its possession or the related
Mortgage Loan Seller has otherwise satisfied the delivery requirements in
accordance with Section 2.01(b), (ii) it or a Custodian on its behalf has
received either a recorded original of each of the assignments specified in
clauses (3) and, insofar as an unrecorded original thereof had been delivered or
caused to be delivered by the related Mortgage Loan Seller, (5) of the
definition of "Mortgage File" or a copy of such recorded original certified by
the applicable public recording office to be true and complete, (iii) all
Mortgage Loan documents received by it or any Custodian have been reviewed by it
or by such Custodian on its behalf and appear regular on their face and relate
to such Mortgage Loan, and (iv) based on the examinations referred to in
subsection (b) above and this subsection (c) and only as to the foregoing
documents, the information set forth in the Mortgage Loan Schedule with respect
to the items specified in clauses (i), (ii), (iii), (iv) and (vii) of the
definition of "Mortgage Loan Schedule", is correct.
(d) It is acknowledged that neither the Trustee nor any Custodian is under
any duty or obligation (i) to determine whether any of the documents specified
in clauses (4) - (8), (10), (11), (13) and (14) of the definition of "Mortgage
File" exist or are required to be delivered by the Depositor, any Mortgage Loan
Seller or any other Person or (ii) 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 genuine, enforceable, in
recordable form or appropriate for the represented purpose or that they are
other than what they purport to be on their face.
(e) If, in the process of reviewing the Mortgage Files or at any time
thereafter, the Trustee or any Custodian finds (or, if at any time, any other
party hereto finds) any document or documents constituting a part of a Mortgage
File to have not been properly executed or, subject to Section 2.01(b), to have
not been delivered, to contain information that does not conform in any material
respect with the corresponding information set forth in the Mortgage Loan
Schedule, or to be defective on its face (each, a "Defect" in the related
Mortgage File) the Trustee (or such other party) shall promptly so notify each
of the other parties hereto and the related Mortgage Loan Seller. If and when
notified of any error in the
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Mortgage Loan Schedule, the Depositor shall promptly correct such error and
distribute a new, corrected Mortgage Loan Schedule to each of the other parties
hereto, and upon receipt by the Trustee of such a corrected Mortgage Loan
Schedule so identified, such new, corrected Mortgage Loan Schedule shall be
deemed to amend and replace the existing Mortgage Loan Schedule for all
purposes.
SECTION 2.03 Mortgage Loan Sellers' Repurchase of Mortgage Loans for
Defects in Mortgage Files and Breaches of Representations
and Warranties.
(a) If the Trustee discovers or receives notice of a Defect in any Mortgage
File or a breach of any representation or warranty set forth in Section 4(a) of
each Mortgage Loan Purchase Agreement (a "Breach"), which Defect or Breach, as
the case may be, materially and adversely affects the value of any Mortgage Loan
or the interests of the Certificateholders therein, or if the Trustee discovers
or receives notice of any event that would give rise to the repurchase of a
Mortgage Loan pursuant to Section 6(b) of any Mortgage Loan Purchase Agreement,
the Trustee shall give prompt written notice of such Defect, Breach or event, as
the case may be, to the Depositor, the Master Servicer, the Special Servicer and
the Rating Agencies and the related Mortgage Loan Seller and shall request that
the related Mortgage Loan Seller, within the time period provided for in the
related Mortgage Loan Purchase Agreement, cure such Defect, Breach or event, as
the case may be, in all material respects or repurchase the affected Mortgage
Loan at the applicable Purchase Price in conformity with the related Mortgage
Loan Purchase Agreement, provided, however, that in lieu of effecting any such
repurchase, a Mortgage Loan Seller will be permitted to deliver a Qualifying
Substitute Mortgage Loan and to pay a cash amount equal to the applicable
Substitution Shortfall Amount, subject to the terms and conditions of the
related Mortgage Loan Purchase Agreement and this Agreement; provided, further,
that if such Breach would cause the Mortgage Loan to be other than a "qualified
mortgage" under Section 860G(a)(3) of the Code, such Breach shall be cured
within 90 days of discovery.
As to any Qualifying Substitute Mortgage Loan or Loans, the Trustee shall
direct the related Mortgage Loan Seller to deliver to the Trustee for such
Qualifying Substitute Mortgage Loan or Loans (with a copy to the Master
Servicer), the related Mortgage File(s) with the related Mortgage Note(s)
endorsed as required by clause (1) of the definition of "Mortgage File". No
substitution may be made in any calendar month after the Determination Date for
such month. Monthly Payments due with respect to Qualifying Substitute Mortgage
Loans in the month of substitution shall not be part of the Trust Fund and will
be retained by Master Servicer and remitted by the Master Servicer to the
related Mortgage Loan Seller on the next succeeding Distribution Date. For the
month of Substitution, distributions to Certificateholders will include the
Monthly Payment due on the related Deleted Mortgage Loan for such month and
thereafter the related Mortgage Loan Seller shall be entitled to retain all
amounts received in respect of such Deleted Mortgage Loan.
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In any month in which the related Mortgage Loan Seller substitutes one or
more Qualifying Substitute Mortgage Loans for one or more Deleted Mortgage
Loans, the Master Servicer will determine the applicable Substitution Shortfall
Amount. The Trustee shall direct the related Mortgage Loan Seller to deposit
cash equal to such amount into the Distribution Account concurrently with the
delivery of the Mortgage File(s) for the Qualifying Substitute Mortgage Loan(s),
without any reimbursement thereof. The Trustee shall also direct the related
Mortgage Loan Seller to give written notice to the Trustee and the Master
Servicer of such deposit, accompanied by an Officers' Certificate as to the
calculation the applicable Substitution Shortfall Amount. The Trustee shall
direct the related Mortgage Loan Seller to amend the Mortgage Loan Schedule to
reflect the removal of each Deleted Mortgage Loan and, if applicable, the
substitution of the Qualifying Substitute Mortgage Loan(s); and, upon such
amendment, the Trustee shall deliver or cause the delivery of such amended
Mortgage Loan Schedule to the other parties hereto. Upon any such substitution,
the Qualifying Substitute Mortgage Loan(s) shall be subject to the terms of this
Agreement in all respects.
(b) In connection with any repurchase of or substitution for a Mortgage
Loan contemplated by this Section 2.03, the Trustee, the Master Servicer and the
Special Servicer shall each tender promptly to the related Mortgage Loan Seller,
upon delivery to each of the Trustee, the Master Servicer and the Special
Servicer of a trust receipt executed by the related 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 related
Mortgage File that was endorsed or assigned to the Trustee shall be endorsed or
assigned, as the case may be, to the related Mortgage Loan Seller in the same
manner as provided in Section 2 of the related Mortgage Loan Purchase Agreement.
Additionally, in connection with any repurchase of or substitution for a
Mortgage Loan pursuant to this Section 2.03, the Master Servicer shall release
or cause to be released to the related Mortgage Loan Seller any Reserve Funds or
Escrow Payments with respect to the related Mortgage Loan. If the affected
Mortgage Loan is to be repurchased, the Trustee shall designate the Certificate
Account as the account to which funds in the amount of the Purchase Price are to
be wired.
(c) Section 6 of the related Mortgage Loan Purchase Agreement provides the
sole remedy available to the Certificateholders, or the Trustee on behalf of the
Certificateholders, respecting any Defect in a Mortgage File or any Breach of
any representation or warranty set forth in or required to be made pursuant to
Section 4(a) of such Mortgage Loan Purchase Agreement or any of the
circumstances described in Section 6(b) of such Mortgage Loan Purchase
Agreement.
(d) The Trustee shall, for the benefit of the Certificateholders, enforce
the obligations of each Mortgage Loan Seller under Section 6 of the related
Mortgage Loan Purchase Agreement. Such enforcement, including, without
limitation, the legal prosecution of claims, shall be carried out in such form,
to such extent and at such time as the Trustee would require were it, in its
individual capacity, the owner of the affected Mortgage Loan(s). The Trustee
shall be reimbursed for the reasonable costs of such enforcement, together with
interest thereon
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at the Reimbursement Rate: first, from a specific recovery of costs, expenses or
attorneys' fees against the related Mortgage Loan Seller; second, pursuant to
Section 3.05(a)(ix) out of the related Purchase Price, to the extent that such
expenses are a specific component thereof; and third, if at the conclusion of
such enforcement action it is determined that the amounts described in clauses
first and second are insufficient, then pursuant to Section 3.05(a)(x) out of
general collections on the Mortgage Loans on deposit in the Certificate Account.
SECTION 2.04 Issuance of Class R-I Certificates; Creation of REMIC I
Regular Interests.
Concurrently with the assignment to the Trustee of the assets included in
REMIC I, and in exchange therefor, at the direction of the Depositor, the REMIC
I Regular Interests have been issued hereunder and the Trustee has executed, and
caused the Certificate Registrar to authenticate and deliver, 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 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 of the
Class R-I Certificateholders and REMIC II in and to such distributions, shall be
as set forth in this Agreement.
SECTION 2.05 Conveyance of REMIC I Regular Interests; Acceptance of REMIC
II by the Trustee.
The Depositor, as of the Closing Date, and concurrently with the execution
and delivery hereof, 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 Class R-II Certificateholders and REMIC II
Regular Interest holders. 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 Class R-II
Certificateholders and REMIC II Regular Interest holders.
SECTION 2.06 Issuance of Class R-II Certificates; Creation of REMIC II
Regular Interest.
Concurrently with the assignment to the Trustee of the REMIC I Regular
Interests, and in exchange therefor, at the direction of the Depositor, the
REMIC II Regular Interests have been issued hereunder and the Trustee has
executed, and caused the Certificate Registrar to authenticate and deliver, to
or upon the order of the Depositor, the Class R-II Certificates in authorized
denominations. The interests evidenced by the Class R-II Certificates, together
with the REMIC II Regular Interests, constitute the entire beneficial ownership
of REMIC II. The rights of the Class R-II Certificateholders and REMIC III to
receive distributions from the proceeds of REMIC II in respect of the Class R-II
Certificates and the
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REMIC II Regular Interests, respectively, and all ownership interests of the
Class R-II Certificateholders and REMIC III in and to such distributions, shall
be as set forth in this Agreement.
SECTION 2.07 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 hereof, 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 REMIC III Certificateholders. 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 REMIC III Certificateholders.
SECTION 2.08 Issuance of REMIC III Certificates.
Concurrently with the assignment to the Trustee of the REMIC II Regular
Interests, and in exchange therefor, at the direction of the Depositor, the
Trustee has executed, and caused the Certificate Registrar to authenticate and
deliver, 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 respective Classes of REMIC III Certificateholders to
receive distributions from the proceeds of REMIC III in respect of their REMIC
III Certificates, and all ownership interests of the respective Classes of REMIC
III Certificateholders in and to 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 Servicing and Administration of the Mortgage Loans.
(a) Each of the Master Servicer and the Special Servicer shall service and
administer the Mortgage Loans that it is obligated to service and administer
pursuant to this Agreement on behalf of the Trustee and in the best interests of
and for the benefit of the Certificateholders (as determined by the Master
Servicer or the Special Servicer, as the case may be, in its good faith and
reasonable judgment), in accordance with applicable law, the terms of this
Agreement and the terms of the respective Mortgage Loans and, to the extent
consistent with the foregoing, further as follows: (i) with the same care, skill
and diligence as is normal and usual in its general mortgage servicing and REO
property management activities on behalf of third parties or on behalf of
itself, whichever is higher, with respect to mortgage loans and REO properties
that are comparable to those for which it is responsible hereunder; (ii) with a
view to the timely collection of all scheduled payments of principal and
interest under the Mortgage Loans or, if a Mortgage Loan comes into and
continues in default and if, in the good faith and reasonable judgment of the
Special Servicer, no satisfactory arrangements can be made for the collection of
the delinquent payments, the maximization of the recovery on such Mortgage Loan
to the Certificateholders (as a collective whole) 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); and (iii)
without regard to (A) any relationship that the Master Servicer or the Special
Servicer, as the case may be, or any Affiliate thereof may have with the related
Mortgagor, (B) the ownership of any Certificate by the Master Servicer or the
Special Servicer, as the case may be, or by any Affiliate thereof, (C) the
Master Servicer's obligation to make Advances, (D) the Special Servicer's
obligation to make (or to direct the Master Servicer to make) Servicing Advances
and (E) the right of the Master Servicer (or any Affiliate thereof) or the
Special Servicer (or any Affiliate thereof), as the case may be, to receive
reimbursement of costs, or the sufficiency of any compensation payable to it,
hereunder or with respect to any particular transaction (the conditions set
forth in the immediately foregoing clauses (i), (ii) and (iii), the "Servicing
Standard"). Without limiting the generality of the foregoing, each of the Master
Servicer and the Special Servicer, in its own name, in connection with its
servicing and administrative duties hereunder is hereby authorized and empowered
by the Trustee to exercise efforts consistent with the foregoing standard and to
execute and deliver, on behalf of the Certificateholders and the Trustee or any
of them, any and all financing statements, continuation statements and other
documents or instruments necessary to maintain the lien created by any Mortgage
or other security document in the related Mortgage File on the related Mortgaged
Property and related collateral; subject to Section 3.20, any and all
modifications, waivers, amendments or consents to or with respect to any
documents contained in the related Mortgage File; and any and all instruments of
satisfaction or cancellation, or of full release or
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discharge, and all other comparable instruments, with respect to the Mortgage
Loans and the Mortgaged Properties. Each of the Master Servicer and the Special
Servicer is also authorized to approve a request by a Mortgagor under a Mortgage
Loan that it is obligated to service and administer pursuant to this Agreement,
for an easement, consent to alteration or demolition, and for other similar
matters, provided that the Master Servicer or the Special Servicer, as the case
may be, determines, exercising its good faith business judgment and in
accordance with the Servicing Standard, that such approval will not affect the
security for, or the timely and full collectability of, the related Mortgage
Loan. Subject to Section 3.10, the Trustee shall furnish, or cause to be
furnished, to the Master Servicer and the Special Servicer any powers of
attorney and other documents necessary or appropriate to enable the Master
Servicer or the Special Servicer, as the case may be, to carry out its servicing
and administrative duties hereunder; provided, however, that the Trustee shall
not be held liable, and shall be indemnified by the Master Servicer or the
Special Servicer, as applicable, for any negligence with respect to, or misuse
of, any such power of attorney by the Master Servicer or the Special Servicer,
as the case may be.
(b) Subject to Section 3.01(a), the Master Servicer and the Special
Servicer each shall have full power and authority, acting alone or, subject to
Section 3.22, through Sub-Servicers, 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.
(c) The relationship of the Master Servicer and the Special Servicer to the
Trustee and, unless the same Person acts in both capacities, to each other under
this Agreement is intended by the parties to be that of an independent
contractor and not that of a joint venturer, partner or agent. Unless the same
Person acts in both capacities, the Master Servicer shall have no responsibility
for the performance by the Special Servicer of its duties under this Agreement,
and the Special Servicer shall have no responsibility for the performance of the
Master Servicer under this Agreement.
SECTION 3.02 Collection of Mortgage Loan Payments.
The Master Servicer (or the Special Servicer with respect to the Specially
Serviced Mortgage Loans) shall make reasonable efforts to collect all payments
called for under the terms and provisions of the Mortgage Loans, and shall, to
the extent such procedures shall be consistent with this Agreement and the terms
and conditions of the Mortgage Loans, follow such collection procedures as are
consistent with the Servicing Standard; provided, however, that nothing herein
contained shall be construed as an express or implied guarantee by the Master
Servicer or the Special Servicer of the collectability of the Mortgage Loans.
Consistent with the foregoing, the Master Servicer may in its discretion waive
any Penalty Charge in connection with any delinquent payment on a Mortgage Loan
(other than a Specially Serviced Mortgage Loan) and the Special Servicer may in
its discretion waive any Penalty Charge in connection with any delinquent
payment on a Specially Serviced Mortgage Loan.
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SECTION 3.03 Collection of Taxes, Assessments and Similar Items; Servicing
Accounts and Reserve Accounts.
(a) Each of the Master Servicer (or the Special Servicer with respect to
the Specially Serviced Mortgage Loans) shall establish and maintain one or more
accounts (the "Servicing Accounts"), into which all Escrow Payments shall be
deposited and retained. Servicing Accounts shall be Eligible Accounts.
Withdrawals of amounts so collected in respect of any Mortgage Loan (and
interest earned thereon) from a Servicing Account may be made only to: (i)
effect payment of real estate taxes, assessments, insurance premiums, ground
rents (if applicable) and comparable items in respect of the related Mortgaged
Property; (ii) reimburse the Fiscal Agent, the Trustee, the Master Servicer and
the Special Servicer, in that order, as applicable, for any unreimbursed
Servicing Advances made thereby to cover any of the items described in the
immediately preceding clause (i); (iii) refund to the related Mortgagor any sums
as may be determined to be overages; (iv) pay interest, if required and as
described below, to the related Mortgagor on balances in the Servicing Account
(or, if and to the extent not payable to the related Mortgagor, to pay such
interest to the Master Servicer or Special Servicer, as applicable); (v)
disburse Insurance Proceeds if required to be applied to the repair or
restoration of the related Mortgaged Property; or (vi) clear and terminate the
Servicing Account at the termination of this Agreement in accordance with
Section 9.01. As part of its servicing duties, the Master Servicer and the
Special Servicer shall pay or cause to be paid to the Mortgagors interest on
funds in Servicing Accounts maintained thereby, to the extent required by law or
the terms of the related Mortgage Loan.
(b) Each of the Master Servicer (with respect to Mortgage Loans other than
Specially Serviced Mortgage Loans) and the Special Servicer (with respect to the
Specially Serviced Mortgage Loans) shall (i) maintain accurate records with
respect to each 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) for Mortgage Loans
which require the related Mortgagor to escrow for the payment of such items and
shall effect payment thereof prior to the applicable penalty or termination
date, employing for such purpose Escrow Payments as allowed under the terms of
the related Mortgage Loan. To the extent that a Mortgage Loan does not require a
Mortgagor to escrow for the payment of real estate taxes, assessments, insurance
premiums, ground rents (if applicable) and similar items, the Master Servicer
(or the Special Servicer with respect to the Specially Serviced Mortgaged Loans)
shall use reasonable efforts consistent with the Servicing Standard to cause the
related Mortgagor to comply with the requirements of the related Mortgage for
payments in respect of such items at the time they first become due.
(c) In accordance with the Servicing Standard, the Master Servicer (at the
direction of the Special Servicer in the case of Specially Serviced Mortgage
Loans) shall advance with respect to each related Mortgaged Property all such
funds as are necessary for the purpose
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of effecting the payment of (i) real estate taxes, assessments and other similar
items that are or may become a lien thereon, (ii) ground rents (if applicable),
and (iii) premiums on Insurance Policies, in each instance if and to the extent
Escrow Payments 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 advance would not, if made,
constitute a Nonrecoverable Servicing Advance. All such advances shall be
reimbursable in the first instance from related collections from the Mortgagors,
and further as provided in Section 3.05. No costs incurred by the Master
Servicer or the Special Servicer in effecting the payment of real estate taxes,
assessments, ground rents (if applicable) and other similar items on or in
respect of the Mortgaged Properties shall, for purposes hereof, including,
without limitation, calculating monthly distributions to Certificateholders, be
added to the unpaid principal balances of the related Mortgage Loans,
notwithstanding that the terms of such Mortgage Loans so permit.
(d) The Master Servicer (or the Special Servicer with respect to Specially
Serviced Mortgage Loans) shall, establish and maintain, as applicable, one or
more accounts (the "Reserve Accounts"), into which all Reserve Funds, if any,
shall be deposited and retained. Withdrawals of amounts so deposited may be made
to pay for, or to reimburse the related Mortgagor in connection with, the
related repairs, environmental remediation, replacements and/or capital
improvements at the related Mortgaged Property if such repairs, environmental
remediation, replacements 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. Subject to the terms of the related
Mortgage Note and Mortgage, all Reserve Accounts shall be Eligible Accounts.
SECTION 3.04 Certificate Account, Distribution Account and Interest Reserve
Account.
(a) The Master Servicer shall establish and maintain a Certificate Account
in which the Master Servicer shall deposit or cause to be deposited on a daily
basis, except as otherwise specifically provided herein, the following payments
and collections received or made by or on behalf of it 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), and 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, including Principal Prepayments,
on the Mortgage Loans;
(ii) all payments on account of interest (including, without limitation,
Default Interest and Excess Interest) on the Mortgage Loans, late payment
charges and Prepayment Premiums;
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(iii) any amounts received from the Special Servicer which are required to
be transferred from the REO Account pursuant to Section 3.16 (c) and amounts of
interest and investment income earned in respect of amounts relating to the
Trust Fund held in any Lock-Box Account or Cash Collateral Account, if any, and
only to the extent not required to be paid to the applicable Mortgagor under the
terms of the related Mortgage Loan documents or applicable law;
(iv) all Insurance Proceeds and Liquidation Proceeds received in respect of
any Mortgage Loan or REO Property (other than Liquidation Proceeds that are
received in connection with the Master Servicer's or Depositor's purchase of all
the Mortgage Loans and any REO Properties in the Trust Fund and that are to be
deposited in the Distribution Account pursuant to Section 9.01);
(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 relating to the Trust Fund held in the Certificate Account;
(vi) that portion of each Delinquency Advance that represents (without
duplication) the Master Servicing Fee and, if applicable, the Special Servicing
Fee; and
(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.
The foregoing requirements for deposit in the Certificate Account shall be
exclusive, it being understood and agreed that, without limiting the generality
of the foregoing, actual payments from Mortgagors in the nature of Escrow
Payments, Reserve Funds, charges for beneficiary statements or demands,
assumption fees, amounts collected for mortgagor checks returned for
insufficient funds, ancillary fees and any other amounts that the Master
Servicer and the Special Servicer are entitled to as additional servicing
compensation pursuant to Section 3.11 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, modification fees, ancillary fees and other
transaction fees due to and received by the Master Servicer with respect to
Specially Serviced Mortgage Loans. 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 serviced and the other
accounts of the Master Servicer.
Upon receipt of any of the amounts described in clauses (i), (ii) and (iv)
above with respect to any Mortgage Loan which is not an REO Loan, the Special
Servicer shall promptly, but in no event later than two Business Days after
receipt, remit such amounts to the
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Master Servicer for deposit into the Certificate Account in accordance with the
second preceding paragraph, unless the Special Servicer determines, consistent
with the Servicing Standard, that a particular item should not be deposited
because of a restrictive endorsement or other appropriate reason. Any such
amounts received by the Special Servicer with respect to an REO Property shall
be deposited by the Special Servicer into the REO Account and remitted to the
Master Servicer for deposit into the Certificate Account pursuant to Section
3.16 (c). With respect to any such amounts paid by check to the order of the
Special Servicer, the Special Servicer shall endorse such check to the order of
the Master Servicer and shall deliver promptly, but in no event later than two
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.
Funds in the Certificate Account may be invested in Permitted Investments
in accordance with the provisions of Section 3.06. The Master Servicer shall
give notice to the Trustee, the Special Servicer and the Depositor 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.
(b) The Trustee shall establish and maintain the Distribution Account in
trust for the benefit of the Certificateholders. The Distribution Account shall
be maintained as a segregated account, separate and apart from trust funds for
mortgage pass-through certificates of other series administered by the Trustee
and other accounts of the Trustee.
The Master Servicer shall deliver to the Trustee each month on or before
the Master Servicer Remittance Date therein, for deposit in the Distribution
Account, that portion of the Available Distribution Amount (calculated without
regard to clause (a)(vi), (b)(iii) or (b)(vi) of the definition thereof) for the
related Distribution Date then on deposit in the Certificate Account.
In addition, the Master Servicer shall, as and when required hereunder,
deliver to the Trustee for deposit in the Distribution Account:
(i) [reserved];
(ii) any Delinquency Advances required to be made by the Master Servicer in
accordance with Section 4.03 (in each case, net of the portion thereof that
represents Master Servicing Fees and/or Special Servicing Fees, which is to be
deposited in the Certificate Account);
(iii) any Compensating Interest Payments required to be made by the Master
Servicer pursuant to Section 3.19;
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(iv) any Liquidation Proceeds paid by the Master Servicer or the Depositor
in connection with the purchase of all of the Mortgage Loans and any REO
Properties in the Trust Fund pursuant to Section 9.01 (exclusive of that portion
thereof required to be deposited in the Certificate Account pursuant to Section
9.01); and
(v) any other amounts required to be so delivered for deposit in the
Distribution Account pursuant to any provision of this Agreement.
The Trustee shall, upon receipt, deposit in the Distribution Account any
and all amounts received by the Trustee that are required by the terms of this
Agreement to be deposited therein. If, as of 3:00 p.m., New York City time, on
any Master Servicer Remittance Date or on such other date as any amount referred
to in the foregoing clauses (ii) through (v) is required to be delivered
hereunder, the Master Servicer shall not have delivered to the Trustee for
deposit in the Distribution Account the relevant portion of the Available
Distribution Amount or any of the amounts referred to in the foregoing clauses
(ii) through (v), then the Trustee shall provide notice of such failure to a
Servicing Officer of the Master Servicer by facsimile transmission sent to
telecopy no. (215) 328-3478 (or such alternative number provided by the Master
Servicer to the Trustee in writing) and by telephone at telephone no. (215)
328-1789 (or such alternative number provided by the Master Servicer to the
Trustee in writing) as soon as possible, but in any event before 5:00 p.m., New
York City time, on such day.
Funds in the Distribution Account shall not be invested. The Trustee shall
give notice to the Master Servicer, the Special Servicer and the Depositor of
the location of the Distribution Account as of the Closing Date and of the new
location of the Distribution Account prior to any change thereof.
(c) The Trustee shall establish and maintain the Interest Reserve Account
in trust for the benefit of the Certificateholders. The Interest Reserve Account
shall be maintained as a segregated account, separate and apart from trust funds
for mortgage pass-through certificates of other series administered by the
Trustee and other accounts of the Trustee. Funds in the Interest Reserve Account
may be invested in Permitted Investments in accordance with the provisions of
Section 3.06.
On each Master Servicer Remittance Date occurring in (i) January of each
calendar year that is not a leap year and (ii) February of each calendar year,
the Trustee shall calculate the Withheld Amount with respect to each Interest
Reserve Loan. On each such Master Servicer Remittance Date, the Trustee shall
withdraw from the Distribution Account and deposit in the Interest Reserve
Account an amount equal to the aggregate of the Withheld Amounts calculated in
accordance with the previous sentence. If the Trustee shall deposit in the
Interest Reserve Account any amount not required to be deposited therein, it may
at any time withdraw such amount from the Interest Reserve Account, any
provision herein to the contrary notwithstanding. On or prior to the Master
Servicer Remittance Date in March of each calendar
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year, the Trustee shall transfer to the Distribution Account the aggregate of
all Withheld Amounts on deposit in the Interest Reserve Account.
SECTION 3.05 Permitted Withdrawals From the Certificate Account, the
Distribution Account and the Interest Reserve Account.
(a) The Master Servicer may, from time to time, make withdrawals from the
Certificate Account for any of the following purposes:
(i) to remit to the Trustee for deposit in the Distribution Account the
amounts required to be remitted pursuant to the second paragraph of Section
3.04(b) or that may be applied to make Delinquency Advances pursuant to Section
4.03(a);
(ii) to pay itself unpaid Master Servicing Fees earned thereby in respect
of each Mortgage Loan and REO Loan, the Master Servicer's rights to payment
pursuant to this clause (ii) being limited to amounts received or advanced on or
in respect of such Mortgage Loan or such REO Loan that are allocable as a
recovery of interest thereon;
(iii) to pay to the Special Servicer, out of general collections on the
Mortgage Loans and any REO Properties, earned and unpaid Special Servicing Fees
in respect of each Specially Serviced Mortgage Loan and REO Loan;
(iv) to pay to the Special Servicer earned and unpaid Workout Fees and
Liquidation Fees to which it is entitled pursuant to, and from the sources
contemplated by, Section 3.11(c);
(v) to reimburse the Fiscal Agent, the Trustee and itself, in that order,
as applicable, for unreimbursed Delinquency Advances made thereby, the Master
Servicer's, Trustee's or the Fiscal Agent's respective rights to be reimbursed
pursuant to this clause (iv) being limited to amounts received that represent
Late Collections of interest on and principal of the particular Mortgage Loans
and REO Loans with respect to which such Delinquency Advances were made (in each
case, net of related Workout Fees);
(vi) to reimburse the Fiscal Agent, the Trustee, itself and the Special
Servicer, in that order, as applicable, for unreimbursed Servicing Advances made
thereby, the Master Servicer's, the Special Servicer's, Trustee's or the Fiscal
Agent's respective rights to be reimbursed pursuant to this clause (vi) with
respect to any Mortgage Loan or REO Property being limited to, as applicable,
related payments, Liquidation Proceeds, Insurance Proceeds and REO Revenues;
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(vii) to reimburse the Fiscal Agent, the Trustee, itself and the Special
Servicer, in that order, as applicable, out of general collections on the
Mortgage Loans and REO Properties, for Nonrecoverable Advances made thereby;
(viii) at or following such time as it reimburses the Fiscal Agent, the
Trustee, itself and the Special Servicer, in that order, as applicable, for any
unreimbursed Advance pursuant to clause (v), (vi) or (vii) above or Section
3.03, to pay the Fiscal Agent, the Trustee, itself or the Special Servicer, in
that order as the case may be, out of general collections on the Mortgage Loans
and REO Properties, any related Advance Interest accrued and payable on such
Advance in accordance with Section 3.11(f) and 4.03(d);
(ix) to reimburse itself (if it is not the affected Mortgage Loan Seller)
or the Trustee, as the case may be, for any unreimbursed expenses reasonably
incurred by such Person in respect of any Breach or Defect giving rise to a
repurchase obligation of a Mortgage Loan Seller under Section 6 of the related
Mortgage Loan Purchase Agreement, including, without limitation, any expenses
arising out of the enforcement of the repurchase obligation, together with
interest thereon at the Reimbursement Rate, each such Person's right to
reimbursement pursuant to this clause (ix) with respect to any Mortgage Loan
being limited to that portion of the Purchase Price paid for such Mortgage Loan
that represents such expense in accordance with clause (d) of the definition of
Purchase Price;
(x) in accordance with Section 2.03(d), to reimburse the Trustee, out of
general collections on the Mortgage Loans and REO Properties for any
unreimbursed expense reasonably incurred by the Trustee in connection with the
enforcement of a Mortgage Loan Seller's obligations under Section 6(a) of the
related Mortgage Loan Purchase Agreement, together with interest thereon at the
Reimbursement Rate, but only to the extent that such expenses are not
reimbursable pursuant to clause (ix) above or otherwise;
(xi) to pay out of general collections on the Mortgage Loans and REO
Properties, for costs and expenses incurred by the Trust Fund pursuant to
Section 3.09(c);
(xii) to pay itself, as additional servicing compensation in accordance
with Section 3.11(b), (A) interest and investment income earned in respect of
amounts relating to the Trust Fund held in the Certificate Account, any Lock-box
Account and Cash Collateral Account as provided in Section 3.06(b) (but only to
the extent of the Net Investment Earnings with respect to the Certificate
Account, any Lock-box Account and Cash Collateral Account for any Collection
Period), (B) Prepayment Interest Excesses and Balloon Payment Interest Excess
received on the Mortgage Loans and (C) Penalty Charges received on Mortgage
Loans that are not Specially Serviced Mortgage Loans (but only to the extent not
otherwise allocable to cover Advance Interest in respect of the related Mortgage
Loan);
(xiii) to pay to the Special Servicer, as additional servicing
compensation, all Penalty Charges received on any Specially Serviced Mortgage
Loan (but only to the extent not
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otherwise allocable to pay Advance Interest in respect of the related Specially
Serviced Mortgage Loan);
(xiv) to pay itself, the Depositor, or any of their respective directors,
officers, employees and agents, as the case may be, out of general collections
on the Mortgage Loans and REO Properties, any amounts payable to any such Person
pursuant to Section 6.03;
(xv) to pay, out of general collections on the Mortgage Loans and REO
Properties, for (A) the cost of the Opinions of Counsel contemplated by Sections
3.09(b)(ii) and 3.16(a), (B) the cost of the advice of counsel contemplated by
Section 3.17(a), (C) the cost of any Opinion of Counsel contemplated by Section
11.01(a) in connection with an amendment to this Agreement requested by the
Master Servicer, which amendment is in furtherance of the rights and interests
of Certificateholders, (D) the cost of obtaining the REO Extension contemplated
by Section 3.16(a), (E) the cost of recording this Agreement in accordance with
Section 11.02(a), and (F) the cost of an Appraisal obtained pursuant to Section
3.11(g) or Section 4.03(c);
(xvi) to pay itself, the Special Servicer, any Mortgage Loan Seller or the
Majority Certificateholder of the Controlling Class, as the case may be, with
respect to each Mortgage Loan, if any, previously purchased by such Person
pursuant to or as contemplated by this Agreement, all amounts received on such
Mortgage Loan subsequent to the date of purchase;
(xvii) to withdraw funds deposited into the Certificate Account in error;
and
(xviii) to clear and terminate the Certificate Account at the termination
of this Agreement pursuant to Section 9.01.
For each Mortgage Loan, the Master Servicer shall keep and maintain
separate accounting records, on a loan-by-loan basis (and for each REO Loan, on
a property-by-property basis) when appropriate, for the purpose of justifying
any withdrawal from the Certificate Account.
The Master Servicer shall pay to the Special Servicer (or to third party
contractors at the direction of the Special Servicer) from the Certificate
Account amounts permitted to be paid to it (or to such third party contractors)
therefrom promptly upon receipt of a certificate of a Servicing Officer of the
Special Servicer describing the item and amount to which the Special Servicer
(or such third party contractors) 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.
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(b) The Trustee may, from time to time, make withdrawals from the
Distribution Account for any of the following purposes:
(i) to make distributions to Certificateholders on each Distribution Date
pursuant to Section 4.01 and to deposit the Withheld Amounts in the Interest
Reserve Account pursuant to Section 3.04(c);
(ii) to pay itself unpaid Trustee Fees pursuant to Section 8.05(a);
(iii) to pay itself or any of its directors, officers, employees and
agents, as the case may be, any amounts payable or reimbursable to any such
Person pursuant to Section 8.05(b);
(iv) to pay for (A) the cost of the Opinion of Counsel contemplated by
Section 11.01(a) or (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, (B) the cost of the Opinion of Counsel
contemplated by Section 11.02(a) in connection with any recordation of this
Agreement and (C) to the extent payable out of the Trust Fund, the cost of the
Opinion of Counsel contemplated by Section 10.01(f);
(v) to (A) pay any and all federal, state and local taxes imposed on REMIC
I, REMIC II or REMIC III or on the assets or transactions of any such REMIC,
together with all incidental costs and expenses, and any and all reasonable
expenses relating to tax audits, if and to the extent that either (1) none of
the Trustee, the Master Servicer or the Special Servicer is liable therefor
pursuant to Section 10.01(g) or (2) any such Person that may be so liable has
failed to make the required payment, and (B) reimburse the Trustee for
reasonable expenses incurred by and reimbursable to it by the Trust Fund
pursuant to Section 10.01(c);
(vi) to withdraw funds deposited into the Distribution Account in error;
and
(vii) to clear and terminate the Distribution Account at the termination of
this Agreement pursuant to Section 9.01.
(c) The Master Servicer may, from time to time, request the Trustee to make
withdrawals from the Interest Reserve Account to pay itself, as additional
servicing compensation in accordance with Section 3.11(b), interest and
investment income earned in respect of amounts relating to the Trust Fund held
in the Interest Reserve Account (but only to the extent of Net Investment
Earnings with respect to the Interest Reserve Account for any Collection
Period).
SECTION 3.06 Investment of Funds in the Certificate Account, the Interest
Reserve Account and the REO Account.
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(a) (i) The Master Servicer may direct any depository institution
maintaining the Certificate Account, any Lock-Box Account, any Cash Collateral
Account or the Interest Reserve Account, and (ii) the Special Servicer may
direct any depository institution maintaining the REO Account (each, 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, (i) 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, if a Person other than
the depository institution maintaining such account is the obligor thereon, and
(ii) no later than the next succeeding date on which such funds are required to
be withdrawn from such account pursuant to this Agreement, if the depository
institution maintaining such account is the obligor thereon. All such Permitted
Investments shall be held to maturity, unless payable on demand. Any investment
of funds in an Investment Account shall be made in the name of the Trustee (in
its capacity as such). The Master Servicer (with respect to Permitted
Investments of amounts in the Certificate Account, any Lock-Box Account and any
Cash Collateral Account) and the Special Servicer (with respect to Permitted
Investments of amounts in the REO Account) on behalf of the Trustee, and the
Trustee (with respect to Permitted Investment of amounts in the Interest Reserve
Account), shall maintain continuous possession of any Permitted Investment that
is either (i) a "certificated security", as such term is defined in the Uniform
Commercial Code of any applicable jurisdiction (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, as
applicable, shall constitute possession by a person designated by the Trustee
for purposes of Articles 8 and 9 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. In the event 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, any Lock-Box Account or any Cash Collateral
Account), the Special Servicer (in the case of the REO Account) and the Trustee
(in the case of the Interest Reserve 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, the Special Servicer or the Trustee,
as the case may be, that such Permitted Investment would not constitute a
Permitted Investment in respect of funds thereafter on deposit in the
Investment Account.
(b) Whether or not the Master Servicer directs the investment of funds in
the Certificate Account or the Interest Reserve Account and, to the extent the
Master Servicer directs the investment of funds in any Lock-Box Account or any
Cash Collateral Account,
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interest and investment income realized on funds deposited in each such
Investment Account, to the extent of the Net Investment Earnings, if any, with
respect to such account for each Collection Period, shall be for the sole and
exclusive benefit of the Master Servicer and shall be subject to its withdrawal,
or withdrawal at its direction, in accordance with Section 3.05(a) or 3.05(c),
as the case may be. 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
such Investment Account 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 the Certificate Account or the Interest
Reserve Account, and to the extent the Master Servicer directs the investment of
funds in any Lock-Box Account or any Cash Collateral Account the Master Servicer
shall deposit therein, no later than the end of the Collection Period during
which such loss was incurred, without right of reimbursement, the amount of the
Net Investment Loss, if any, with respect to such account for such Collection
Period. If any loss shall be incurred in respect of any Permitted Investment on
deposit in the REO Account, the Special Servicer shall promptly deposit therein
from its own funds, without right of reimbursement, no later than the end of the
Collection Period during which such loss was incurred, the amount of the Net
Investment Loss, if any, for such Collection Period.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment, the Trustee may and, subject to Section 8.02, upon the request of
Holders of Certificates entitled to a majority 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.
SECTION 3.07 Maintenance of Insurance Policies; Errors and Omissions and
Fidelity Coverage.
(a) Each of the Master Servicer (in the case of Mortgage Loans other than
Specially Serviced Mortgage Loans) and the Special Servicer (in the case of
Specially Serviced Mortgage Loans) shall use reasonable efforts to cause each
Mortgagor to maintain in respect of the related Mortgaged Property all insurance
coverage as is required under the related Mortgage; provided that if any
Mortgage permits the holder thereof to dictate to the Mortgagor the insurance
coverage to be maintained on such Mortgaged Property, the Master Servicer or the
Special Servicer, as appropriate, shall impose such insurance requirements as
are consistent with the Servicing Standard. If a Mortgagor fails to maintain
such insurance, the Master Servicer (at the direction of the Special Servicer in
the case of a Specially Serviced Loan) shall (to the extent available at
commercially reasonable terms) obtain such insurance (which may be through a
master or single interest policy) and the cost (including any deductible
relating to such insurance) of such insurance (or in the case of a master or
single interest policy, the incremental cost (including any deductible relating
to such insurance) of such insurance relating to the
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specific Mortgaged Property), shall be a Servicing Advance and shall be
recoverable by the Master Servicer pursuant to Section 3.05(a). If at any time a
Mortgaged Property is located in an area identified in the Flood Hazard Boundary
Map or Flood Insurance Rate Map issued by the Federal Emergency Management
Agency as having special flood hazards or it becomes located in such area by
virtue of remapping conducted by such agency (and flood insurance has been made
available), the Master Servicer (or in the case of a Specially Serviced Loan,
the Special Servicer) shall, if and to the extent that the Mortgage Loan
requires the Mortgagor or permits the mortgagee to require the Mortgagor to do
so, use reasonable efforts to cause the related Mortgagor to maintain a flood
insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration in the maximum amount of insurance coverage
available under the National Flood Insurance Act or 1968, the Flood Disaster
Protection Act of 1973 or the National Flood Insurance Reform Act of 1994, as
amended, unless otherwise specified by the related Mortgage Loan. If (i) the
Mortgagor is required by the terms of the Mortgage Loan to maintain such
insurance (or becomes obligated by virtue of the related Mortgaged Property
becoming located in such area by virtue of such remapping) or (ii) the terms of
the Mortgage Loan permit the mortgagee to require the Mortgagor to obtain such
insurance, the Master Servicer (or in the case of a Specially Serviced Loan, the
Special Servicer), shall promptly notify the Mortgagor of its obligation to
obtain such insurance. If the Mortgagor fails to obtain such flood insurance
within 120 days of such notification, the Master Servicer (or in the case of a
Specially Serviced Loan, the Special Servicer) shall obtain such insurance, the
cost of which shall be a Servicing Advance and shall be recoverable by the
Master Servicer or Special Servicer pursuant to Section 3.05(a); provided that
the Master Servicer or Special Servicer shall not be required to incur any such
cost if such Advance would constitute a Nonrecoverable Servicing Advance.
Subject to Section 3.17(a), the Special Servicer shall also use reasonable
efforts to cause to be maintained for each REO Property (to the extent available
at commercially reasonable terms) no less insurance coverage than was previously
required of the Mortgagor under the related Mortgage or as is consistent with
the Servicing Standard. All such insurance policies shall contain a "standard"
mortgagee clause, with loss payable to the Master Servicer (in the case of
Mortgaged Properties) or the Special Servicer (in the case of REO Properties) on
behalf of the Trustee, and 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 in
accordance with applicable law, the terms of the related Mortgage Loan documents
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
Certificate- holders, be added to the outstanding principal balance of the
related Mortgage Loan, notwithstanding that the terms of such Mortgage Loan so
permit, but shall be recoverable by the Master Servicer as a Servicing Advance
pursuant to Section 3.05(a).
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(b)(I) If the Master Servicer or the Special Servicer obtains and maintains
a blanket policy insuring against hazard losses on all of the Mortgaged
Properties and/or REO Properties for which it is responsible to cause the
maintenance of insurance hereunder, then, to the extent such policy 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 such Mortgaged Properties and/or REO Properties. Such 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 a Mortgaged Property or an REO Property a
hazard insurance policy complying with the requirements of Section 3.07(a), and
there shall have been one or more losses which would have been covered by such
policy, promptly deposit into the Certificate Account (or into the Servicing
Account if insurance proceeds are to be applied to the repair or restoration of
the applicable Mortgaged Property or disbursed to the related Mortgagor) from
its own funds the amount not otherwise payable under the blanket policy because
of such deductible clause to the extent that any such deductible exceeds the
deductible limitation that pertained to the related Mortgage Loan, or, in the
absence of any such deductible limitation, the deductible limitation which is
consistent with the Servicing Standard. The Master Servicer and the Special
Servicer each agrees to prepare and present, on behalf of itself, the Trustee
and Certificateholders, claims under any such blanket policy maintained by it in
a timely fashion in accordance with the terms of such policy.
(II) If the Master Servicer or the Special Servicer, as applicable, causes
any Mortgaged Property or REO Property to be covered by a master force placed
insurance policy, which provides protection equivalent to the individual
policies otherwise required, the Master Servicer or Special Servicer shall
conclusively be deemed to have satisfied its respective obligations to cause
hazard insurance to be maintained on such Mortgaged Properties and/or REO
Properties. Such policy may contain a deductible clause, in which case the
Master Servicer or the Special Servicer, as applicable, shall in the event that
(i) there shall not have been maintained on the related Mortgaged Property or
REO Property a policy otherwise complying with the provisions of Section
3.07(a), and (ii) there shall have been one or more losses which would have been
covered by such a policy had it been maintained, immediately deposit into the
Certificate Account (or into the Servicing Account if insurance proceeds are to
be applied to the repair or restoration of the applicable Mortgaged Property or
disbursed to the related Mortgagor) from its own funds the amount not otherwise
payable under such policy because of such deductible to the extent that any such
deductible exceeds the deductible limitation that pertained to the related
Mortgage Loan, or, in the absence of any such deductible limitation, the
deductible limitation which is consistent with the Servicing Standard. The
Master Servicer and the Special Servicer each agrees to prepare and present, on
behalf of itself, the Trustee and Certificateholders, claims under any such
master force placed insurance policy maintained by it in a timely fashion in
accordance with the terms of such policy.
(c) Each of the Master Servicer and the Special Servicer shall obtain and
maintain at its own expense and keep in full force and effect throughout the
term of this
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Agreement a blanket fidelity bond and an errors and omissions insurance policy
covering its officers and employees and other persons acting on behalf of it in
connection with its activities under this Agreement. The amount of coverage
shall be at least equal to the coverage that would be required by FNMA or FHLMC,
whichever is greater, with respect to the Master Servicer or Special Servicer,
as the case may be, if the Master Servicer or Special Servicer, as the case may
be, were servicing and administering the Mortgage Loans and/or REO Properties
for which it is responsible hereunder for FNMA or FHLMC. Coverage of the Master
Servicer or the Special Servicer under a policy or bond obtained by an Affiliate
of such Person and providing the coverage required by this Section 3.07(c) shall
satisfy the requirements of this Section 3.07(c).
(d) All insurance coverage required to be maintained by the Master Servicer
or Special Servicer, as applicable, under this Section 3.07 shall be obtained
from Qualified Insurers having a claims paying ability rating (or the
obligations of which are guaranteed or backed by a company having such claims
paying ability rating) not less than (i) Baa2 by Moody's and (ii) if rated by
FITCH IBCA, "A" by FITCH IBCA (or, if not rated by FITCH IBCA, rated A-IX or
better by A.M. Best); provided, however, that the requirements of clauses (i)
and (ii) shall not be applicable with respect to Moody's or FITCH IBCA, as
applicable, if the related Rating Agency shall have confirmed in writing that an
insurance company with a lower claims paying ability rating shall not result, in
and of itself, in a downgrade, qualification on withdrawal of the then current
ratings by such Rating Agency of any class of Certificates.
SECTION 3.08 Enforcement of Due-On-Sale Clauses; Assumption Agreements;
Subordinate Financing; Defeasance.
(a) As to each Mortgage Loan which contains a provision in the nature of a
"due-on-sale" clause, which by its terms:
(i) provides that such Mortgage Loan shall (or may at the mortgagee's
option) become due and payable upon the sale or other transfer of an interest in
the related Mortgaged Property; or
(ii) provides that such Mortgage Loan may not be assumed without the
consent of the mortgagee in connection with any such sale or other transfer,
then, for so long as such Mortgage Loan is included in the Trust Fund, the
Master Servicer or, in the case of a Specially Serviced Mortgage Loan, the
Special Servicer, on behalf of the Trustee as the mortgagee of record, shall
exercise (or, subject to Section 3.20(a)(iii), waive its right to exercise) any
right it may have with respect to such Mortgage Loan (x) to accelerate the
payments thereon, or (y) to withhold its consent to any such sale or other
transfer, in a manner consistent with the Servicing Standard. In the event that
the Master Servicer or Special Servicer intends or is required, in accordance
with the preceding sentence, the Mortgage Loan documents or applicable law, to
permit the transfer of any Mortgaged Property, the Master Servicer or the
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Special Servicer, as the case may be, if consistent with the Servicing Standard,
may enter into an assumption and modification agreement with the Person to whom
the related Mortgaged Property has been or is intended to be conveyed or may
enter into substitution of liability agreement, pursuant to which the original
Mortgagor and any original guarantors are released from liability, and the
transferee and any new guarantors are substituted therefor and become liable
under the Mortgage Note and any related guaranties and, in connection therewith,
may require from the related Mortgagor a reasonable and customary fee for the
additional services performed by it, together with reimbursement for any related
costs and expenses incurred by it (but only to the extent that charging such fee
and entering into such assumption and modification agreement will not be a
significant modification of the Mortgage Loan for purposes of the REMIC
Provisions). The Master Servicer or the Special Servicer, as the case may be,
shall promptly notify the Trustee of any such agreement and forward the original
thereof to the Trustee for inclusion in the related Mortgage File. If the Master
Servicer or Special Servicer intends or is required to permit the transfer of
any Mortgaged Property and enter into an assumption agreement or a substitution
of liability agreement, as the case may be, in accordance with the foregoing
with respect to a Mortgage Loan having one of the then-ten highest outstanding
principal balances in the Mortgage Pool, the Master Servicer or the Special
Servicer, as the case may be, prior to entering into such agreement, shall
submit to FITCH IBCA a copy of such agreement together with such other
information with respect to such action as the Master Servicer or Special
Servicer, as applicable, deems appropriate or as FITCH IBCA may reasonably
request, and shall request that FITCH IBCA deliver to the Master Servicer or
Special Servicer, as applicable, written confirmation that the execution of such
agreement would not result in a qualification, withdrawal or downgrade of the
then-current ratings of the Certificates. FITCH IBCA shall respond to such
request within five (5) Business Days of receipt of a copy of such agreement and
any information FITCH IBCA so reasonably requests; provided, however, if the
Master Servicer or Special Servicer shall not have received such written
confirmation within five (5) Business Days of FITCH IBCA's receipt of a copy of
such agreement and such information, such written confirmation shall be
considered to have been delivered to the Master Servicer or Special Servicer by
FITCH IBCA.
(b) As to each Mortgage Loan which contains a provision in the nature of a
"due-on-encumbrance" clause, which by its terms:
(i) provides that such Mortgage Loan shall (or may at the mortgagee's
option) become due and payable upon the creation of any additional lien or other
encumbrance on the related Mortgaged Property; or
(ii) requires the consent of the mortgagee to the creation of any such
additional lien or other encumbrance on the related Mortgaged Property, then,
for so long as such Mortgage Loan is included in the Trust Fund, the Master
Servicer or, in the case of a Specially Serviced Mortgage Loan, the Special
Servicer, on behalf of the Trustee as the mortgagee of record, shall exercise
(or, subject to Section 3.20(a)(iii), waive its right to exercise) any right it
may have with respect to such Mortgage Loan (x) to accelerate the payments
thereon, or (y)
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to withhold its consent to the creation of any such additional lien or other
encumbrance, in a manner consistent with the Servicing Standard; provided,
however that the Master Servicer or, in the case of a Specially Serviced
Mortgage Loan, the Special Servicer, shall not waive its right to exercise any
such right when such right arises as a result of the imposition of a lien
against a Mortgaged Property which lien secures additional indebtedness or a
mechanic's or similar lien, not permitted under the related Mortgage Loan
documents unless the Master Servicer or Special Servicer (as applicable) with
respect to any Mortgage Loan or Specially Serviced Mortgage Loan which has an
unpaid principal balance at such time equal to at least 5% of the then
outstanding balance of the Mortgage Pool, has received written confirmation from
each Rating Agency that such waiver, in and of itself, would not result in a
downgrade, qualification or withdrawal of the then current ratings assigned to
any class of Certificates.
(c) With respect to any Mortgage Loan which permits release of Mortgaged
Properties through a Defeasance Option, the Master Servicer shall, to the extent
consistent with and permitted by the applicable Mortgage Loan documents, permit
the exercise of such Defeasance Option on any Due Date occurring more than two
years after the Startup Day (the "Release Date") upon the satisfaction of the
following conditions:
(i) No event of default exists under the related Mortgage Note;
(ii) The Mortgagor pays on such Release Date (A) all interest accrued and
unpaid on the Principal Balance of the Mortgage Note to and including the
Release Date; (B) all other sums, excluding scheduled interest or principal
payments due under the Mortgage Note and (C) any costs and expenses incurred in
connection with such release;
(iii) The Mortgagor has delivered Defeasance Collateral providing payments
on or prior to all successive scheduled payment dates from the Release Date to
the related Maturity Date, and in an amount equal to or greater than the
scheduled payments due on such dates under the Mortgage Loan;
(iv) The Mortgagor shall have delivered a security agreement granting the
Trust Fund a first priority security interest in the Defeasance Collateral;
(v) The Master Servicer shall have received an Opinion of Counsel from the
related Mortgagor (which shall be an expense of the related Mortgagor) to the
effect that the Trust Fund has a first priority security interest in the
Defeasance Collateral and that the assignment thereof is valid and enforceable;
(vi) The Master Servicer shall have obtained at the related Mortgagor's
expense a certificate from an Independent certified public accountant certifying
that the Defeasance Collateral complies with the requirements of the related
Mortgage Note;
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(vii) If the related Mortgage Loan so requires and provides for the related
Mortgagor to pay the cost thereof, the Master Servicer shall have obtained an
Opinion of Counsel from the related Mortgagor to the effect that such release
will not cause any of REMIC I, REMIC II or REMIC III to fail to qualify as a
REMIC at any time that any Certificates are outstanding or cause a tax to be
imposed on the Trust Fund under the REMIC Provisions; and
(viii) The Borrower shall have provided evidence to the Master Servicer
demonstrating that the lien of the related Mortgage is being released to
facilitate the disposition of the Mortgaged Property or another customary
commercial transaction, and not as part of an arrangement to collateralize the
Certificates issued by the related REMIC with obligations that are not real
estate mortgages.
(d) Nothing in this Section 3.08 shall constitute a waiver of the Trustee's
right, as the mortgagee of record, to receive notice of any assumption of a
Mortgage Loan, any sale or other transfer of the related Mortgaged Property or
the creation of any additional lien or other encumbrance with respect to such
Mortgaged Property.
(e) Except as otherwise permitted by Section 3.20, neither the Master
Servicer nor the Special Servicer shall agree to modify, waive or amend any term
of any Mortgage Loan in connection with the taking of, or the failure to take,
any action pursuant to this Section 3.08.
SECTION 3.09 Realization Upon Defaulted Mortgage Loans.
(a) The Master Servicer shall notify the Special Servicer of the occurrence
of a Servicing Transfer Event in respect of any Mortgage Loan. The Special
Servicer shall monitor such Specially Serviced Mortgage Loan, evaluate whether
the causes of the default can be corrected over a reasonable period without
significant impairment of the value of the related Mortgaged Property, initiate
corrective action in cooperation with the Mortgagor if, in the Special
Servicer's judgment, cure is likely, and take such other actions (including
without limitation, negotiating and accepting a discounted payoff of a Mortgage
Loan) as are consistent with the Servicing Standard. If, in the Special
Servicer's judgment, such corrective action has been unsuccessful, no
satisfactory arrangement can be made for collection of delinquent payments, and
the Defaulted Mortgage Loan has not been released from the Trust Fund pursuant
to any provision hereof, then the Special Servicer shall, subject to subsections
(b) through (d) of this Section 3.09, exercise reasonable efforts, consistent
with the Servicing Standard, to foreclose upon or otherwise comparably convert
(which may include an REO Acquisition) the ownership of property securing such
Mortgage Loan. The foregoing is subject to the provision that, in any case in
which a Mortgaged Property shall have suffered damage from an Uninsured Cause,
the Master Servicer and the Special Servicer shall have the right but not the
obligation to expend its own funds toward the restoration of such property if it
shall determine in its reasonable discretion (i) that such restoration will
increase the net proceeds of liquidation of such Mortgaged Property to
Certificateholders after reimbursement to itself for such expenses, and (ii)
that such expenses will be recoverable by the Master Servicer or Special
Servicer, as the
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case may be, out of the proceeds of liquidation of such Mortgaged Property, as
contemplated in Section 3.05(a). The Special Servicer (or, subject to Section
3.19(c), the Master Servicer) shall advance all other costs and expenses
incurred by it in any such proceedings, subject to its being entitled to
reimbursement therefor as a Servicing Advance as provided in Section 3.05(a) and
further subject to its being entitled to pay out of the related Liquidation
Proceeds any Liquidation Expenses incurred in respect of any Mortgage Loan,
which Liquidation Expenses were outstanding at the time such proceeds are
received. When applicable state law permits the Special Servicer to select
between judicial and non-judicial foreclosure in respect of any Mortgaged
Property, the Special Servicer shall make such selection in a manner consistent
with the Servicing Standard. 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 sole judgment taking into account the factors
described in Section 3.18(e) and the results of any Appraisal obtained pursuant
to this Agreement, 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, the Master Servicer or the
Special Servicer, as the case may be, is authorized to have an Appraisal
performed with respect to such property (the cost of which Appraisal shall be
covered by, and reimbursable as, an Additional Trust Fund Expense).
(b) The Special Servicer shall not acquire any personal property pursuant
to this Section 3.09 (with the exception of cash or cash equivalents pledged as
collateral for a Mortgage Loan) 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 Section
3.05(a)) to the effect that the holding of such personal property by the Trust
Fund will not (subject to Section 10.01(f)) cause the imposition of a tax on the
Trust Fund 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, the
Special Servicer shall not, on behalf of the Trustee, initiate foreclosure
proceedings, obtain title to a Mortgaged Property in lieu of foreclosure or
otherwise, have a receiver of rents appointed with respect to any Mortgaged
Property, 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, would be considered to hold title to, to be a
"mortgagee-in-possession" of, or to be an "owner" or "operator" of such
Mortgaged Property within the meaning of CERCLA or any comparable
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law, unless (as evidenced by an Officer's Certificate to such effect delivered
to the Trustee) the Special Servicer has previously received an Environmental
Assessment in respect of such Mortgaged Property prepared by a Person who
regularly conducts Environmental Assessments and the Special Servicer, based
solely (as to environmental matters and related costs) on the information set
forth in such Environmental Assessment, determines that:
(i) the Mortgaged Property is in compliance with applicable environmental
laws and regulations or, if not, that acquiring such Mortgaged Property and
taking such actions as are necessary to bring the Mortgaged Property in
compliance therewith is reasonably likely to produce a greater recovery to
Certificateholders on a present value basis than not acquiring such Mortgaged
Property and not taking such actions; 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 investigations, 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 be
required, that acquiring such Mortgaged Property and taking such actions with
respect to such Mortgaged Property is reasonably likely to produce a greater
recovery to Certificateholders on a present value basis than not acquiring such
Mortgaged Property and not taking such actions.
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 sentence, may be withdrawn from the Certificate
Account by the Master Servicer at the direction of the Special Servicer as an
expense of the Trust Fund pursuant to Section 3.05(a); and if any such
Environmental Assessment so warrants, the Special Servicer shall, at the expense
of the Trust Fund, perform such additional environmental testing as are
consistent with the Servicing Standard to determine whether the conditions
described in clauses (i) and (ii) of the preceding sentence have been satisfied.
(d) If the environmental testing contemplated by subsection (c) above
establishes that either 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, then the Special Servicer shall
take such action as it deems to be in the best economic interest of the Trust
Fund (other than proceeding to acquire title to the Mortgaged Property) and is
hereby authorized at such time as it deems appropriate to release all or a
portion of such Mortgaged Property from the lien of the related Mortgage.
(e) The Special Servicer shall provide written reports monthly to the
Master Servicer, (who shall forward such reports to the Trustee, who shall
forward such reports to the Certificateholders) regarding any actions taken by
the Special Servicer with respect to any Mortgaged Property securing a Defaulted
Mortgage Loan as to which the environmental testing contemplated in subsection
(c) above has revealed that either of the conditions set forth in
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clauses (i) and (ii) of the first sentence thereof has not been satisfied, in
each case until the earliest to occur of satisfaction of both such conditions,
removal of the related Mortgage Loan from the Trust Fund and release of the lien
of the related Mortgage on such Mortgaged Property.
(f) The Special Servicer shall report to the Internal Revenue Service and
the related Mortgagor, in the manner required by applicable law, the information
required to be reported regarding any Mortgaged Property which is abandoned or
foreclosed, information returns with respect to the receipt of mortgage
interests received in a trade or business and the information returns relating
to cancellation of indebtedness income with respect to any Mortgaged Property
required by Sections 6050J, 6050H and 6050P, respectively, of the Code. Such
reports shall be in form and substance sufficient to meet the reporting
requirements imposed by Sections 6050J, 6050H and 6050P of the Code. The Special
Servicer shall deliver a copy of any such report upon request to the Trustee.
(g) The Special Servicer shall have the right to determine, in accordance
with the Servicing Standard, the advisability of the maintenance of an action 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.
(h) The Special Servicer shall maintain accurate records of each Final
Recovery Determination in respect of a Defaulted Mortgage Loan or REO Property
and the basis thereof. Each Final Recovery Determination shall be evidenced by
an Officer's Certificate delivered to the Trustee no later than the 10th
Business Day following such Final Recovery Determination.
SECTION 3.10 Trustee to Cooperate; Release of Mortgage Files.
(a) Upon the payment in full of any Mortgage Loan, or the receipt by the
Master Servicer or the Special Servicer of a notification that payment in full
shall be escrowed in a manner customary for such purposes, the Master Servicer
or the Special Servicer, as the case may be, will immediately notify the Trustee
and request delivery of the related Mortgage File. Any such notice and request
shall be in the form of a Request for Release signed by a Servicing Officer 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. Within seven Business Days (or within such shorter period as release
can reasonably be accomplished if the Master Servicer or the Special Servicer
notifies the Trustee of an exigency) of receipt of such notice and request, the
Trustee shall release, or cause any related Custodian to release, the related
Mortgage File to the Master Servicer or the Special Servicer, whichever
requested it. No expenses incurred in connection with any instrument of
satisfaction or deed of reconveyance shall be chargeable to the Certificate
Account.
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(b) From time to time as is appropriate for servicing or foreclosure of any
Mortgage Loan, the Master Servicer or the Special Servicer may deliver to the
Trustee a Request for Release signed by a Servicing Officer thereof. Upon
receipt of the foregoing, the Trustee shall deliver or cause the related
Custodian to deliver, the Mortgage File or any document therein to the Master
Servicer or the Special Servicer, as the case may be. Upon return of such
Mortgage File or such document to the Trustee or the related Custodian, or the
delivery to the Trustee of a certificate of a Servicing Officer stating that
such Mortgage Loan was liquidated and that all amounts received or to be
received in connection with such liquidation which are required to be deposited
into the 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, the Request
for Release shall be released by the Trustee to the Master Servicer or the
Special Servicer, as applicable.
(c) Within three Business Days (or within such shorter period as delivery
can reasonably be accomplished if the Special Servicer notifies the Trustee of
an exigency) of receipt thereof, the Trustee shall execute and deliver to the
Special Servicer any court pleadings, requests for trustee's sale or other
documents necessary to the foreclosure or trustee's sale in respect of a
Mortgaged 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. The Special Servicer shall
be responsible for the preparation of all such documents and pleadings. When
submitted to the Trustee for signature, such documents or pleadings shall be
accompanied by a certificate of a Servicing Officer requesting that such plead-
ings 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; Nonrecoverable Servicing Advances.
(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 and REO Loan. As to each Mortgage Loan and REO Loan, the Master Servicing
Fee shall accrue from time to time at the Master Servicing Fee Rate and shall be
computed on the basis of the same principal amount and for the same period
respecting which any related interest payment due on such Mortgage Loan or
deemed to be due on such REO Loan is computed. The Master Servicing Fee with
respect to any Mortgage Loan or REO Loan shall cease to accrue if a Liquidation
Event occurs in respect thereof. The Master Servicing Fee shall be payable
monthly, on a loan- by-loan basis, from payments of interest on each Mortgage
Loan, REO Revenues allocable as interest on each REO Loan and the interest
portion of Delinquency Advances on each Mortgage Loan and REO Loan. The Master
Servicer shall be entitled to recover unpaid Master Servicing Fees in respect of
any Mortgage Loan or REO Loan out of that portion of related Insurance
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Proceeds or Liquidation Proceeds allocable as recoveries of interest, to the
extent permitted by Section 3.05(a). 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 assumption fees,
modification fees, charges for beneficiary statements or demands, amounts
collected for checks returned for insufficient funds and any similar or
ancillary fees (excluding any other amounts relating to Prepayment Premiums), in
each case to the extent actually paid by a Mortgagor with respect to a Mortgage
Loan that is not a Specially Serviced Mortgage Loan, may be retained by the
Master Servicer and are not required to be deposited in the Certificate Account.
The Master Servicer shall also be entitled to additional servicing compensation
in the form of (i) any Prepayment Interest Excesses, Balloon Payment Interest
Excesses, and further to the extent received on Mortgage Loans other than
Specially Serviced Mortgage Loans, any Penalty Charges collected on the Mortgage
Loans; (ii) interest or other income earned on deposits in the Certificate
Account and the Interest Reserve 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 Investment Account for each Collection Period), and (iii) to the
extent not required to be paid to any Mortgagor under applicable law or under
the related Mortgage, any interest or other income earned on deposits in the
Servicing Accounts and Reserve Accounts maintained thereby. The Master Servicer
shall be required to pay out of its own funds all overhead and general and
administrative expenses incurred by it in connection with its servicing
activities hereunder (including, without limitation, payment of any amounts due
and owing to any of Sub-Servicers retained by it 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. The Master Servicer shall pay
the Trustee Fee out of the Servicing Fee without right of reimbursement.
(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 each REO Loan, the Special Servicing Fee shall accrue
from time to time at the Special Servicing Fee Rate on the basis of the same
principal amount and for the same period respecting which any related interest
payment due on such Specially Serviced Mortgage Loan or deemed to be due on such
REO Loan is computed. The Special Servicing Fee with respect to each Specially
Serviced Mortgage Loan and each REO Loan shall cease to accrue as of the date a
Liquidation Event occurs in respect thereof. As to each Specially Serviced
Mortgage Loan and each REO 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).
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As further compensation for its activities hereunder, the Special Servicer
shall be entitled to receive the Workout Fee with respect to each Corrected
Mortgage Loan. As to each Corrected Mortgage Loan, the Workout Fee shall be
payable from, and shall be calculated by application of the Workout Fee Rate to,
each collection of interest and principal received on such Mortgage Loan for so
long as it remains a Corrected Mortgage Loan. The Workout Fee with respect to
any Corrected Mortgage Loan will cease to be payable if a Servicing Transfer
Event occurs with respect thereto or if the related Mortgaged Property becomes
an REO Property; provided that a new Workout Fee will become payable if and when
such Mortgage Loan again becomes a Corrected Mortgage Loan. If the Special
Servicer is terminated other than for cause or resigns in accordance with
Section 6.04, it shall retain the right to receive any and all Workout Fees
payable in respect of Mortgage Loans that became Corrected Mortgage Loans during
the period that it acted as Special Servicer and were still such at the time of
such termination or resignation (and the successor Special Servicer shall not be
entitled to any portion of such Workout Fees), in each case until the Workout
Fee for any such loan ceases to be payable in accordance with the preceding
sentence.
As further compensation for its activities hereunder, the Special Servicer
shall also be entitled to receive a Liquidation Fee with respect to each
Specially Serviced Mortgage Loan or REO Property as to which it receives any
full or discounted payoff or any Liquidation Proceeds (other than in connection
with the purchase of any such Specially Serviced Mortgage Loan or REO Property
by the Special Servicer or the Majority Certificateholder of the Controlling
Class pursuant to Section 3.18 or by the Master Servicer or the Depositor
pursuant to Section 3.18 or Section 9.01). As to each such Specially Serviced
Mortgage Loan or REO Property, the Liquidation Fee shall be payable from, and
shall be calculated by application of the Liquidation Fee Rate to, such full or
discounted payoff and/or such Liquidation Proceeds. No Liquidation Fee will be
payable with respect to any Specially Serviced Mortgage Loan solely by virtue of
such Mortgage Loan becoming a Corrected Mortgage Loan. Notwithstanding anything
herein to the contrary, no Liquidation Fee will be payable from, or based upon
the receipt of, Liquidation Proceeds collected as a result of any purchase of a
Specially Serviced Mortgage Loan or REO Property described in the parenthetical
to the first sentence of this paragraph; provided, however, that if any such
Liquidation Proceeds are received with respect to any Corrected Mortgaged Loan,
and the Special Servicer is properly entitled to a Workout Fee therefrom, such
Workout Fee will be payable based on and from the portion of such Liquidation
Proceeds that constitute principal and/or interest.
Notwithstanding anything to the contrary herein, a Liquidation Fee and a
Workout Fee relating to the same Mortgage Loan shall not be paid from the same
proceeds on or with respect to such Mortgage Loan.
Subject to the Special Servicer's right to employ Sub-Servicers, the
Special Servicer's right to receive the Special Servicing Fee, the Workout Fee
and/or the Liquidation Fee may not be transferred in whole or in part except in
connection with the transfer of all of the Special Servicer's responsibilities
and obligations under this Agreement.
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(d) Additional servicing compensation in the form of assumption fees and
modification fees received on or with respect to Specially Serviced Mortgage
Loans shall be promptly paid to the Special Servicer by the Master Servicer and
shall not be required to be deposited in the Certificate Account pursuant to
Section 3.04(a). Additional servicing compensation in the form of assumption
fees and modification fees that the Master Servicer is entitled to and that are
collected by the Special Servicer, shall be paid promptly to the Master Servicer
by the Special Servicer. The Special Servicer shall also be entitled to
additional servicing compensation in the form of: (i) to the extent not required
to be paid to any Mortgagor under applicable law, any interest or other income
earned on deposits in the REO Account, any Servicing Accounts and any Reserve
Accounts maintained thereby; and (ii) to the extent not required to be paid to
the Master Servicer as additional servicing compensation pursuant to Section
3.11(b), any Penalty Charges collected on the Specially Serviced Mortgage Loans
and REO Loans. The Special Servicer shall be required to pay out of its own
funds all overhead and general and administrative expenses incurred by it in
connection with its servicing activities hereunder (including, without
limitation, payment of any amounts due and owing to any Sub- Servicers retained
by it and the premiums for any blanket policy obtained by it 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 or the REO Account, and
the Special Servicer shall not be entitled to reimbursement except as expressly
provided in this Agreement.
(e) If the Master Servicer or Special Servicer is required under this
Agreement to make a Servicing Advance, but neither does so within 15 days after
such Advance is required to be made, the Trustee shall, to the extent a
Responsible Officer of the Trustee has actual knowledge of such failure by the
Master Servicer or the Special Servicer to make such Advance (subject to Section
3.11(g) below), make such Advance. If the Trustee fails to make a Servicing
Advance required to be made by it, the Fiscal Agent shall make such advance
(subject to 3.11(g) below) within one (1) Business Day of such failure by the
Trustee. The making of such Advance by the Fiscal Agent shall cure the failure
by the Trustee to make such Advance.
(f) The Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent shall each be entitled to receive interest at the Reimbursement Rate in
effect from time to time, accrued on the amount of each Servicing Advance made
thereby for so long as such Servicing Advance is outstanding, payable, first,
out of Penalty Charges received on the Mortgage Loan or REO Loan as to which
such Servicing Advance was made and, then, once such Servicing Advance has been
reimbursed, out of general collections on the Mortgage Loans and REO Properties.
(g) Notwithstanding anything to the contrary set forth herein, none of the
Master Servicer, the Special Servicer, the Trustee or the Fiscal Agent shall be
required to make any Servicing Advance that it determines in its reasonable,
good faith judgment would constitute a Nonrecoverable Servicing Advance;
provided, however, that the Special Servicer may make an Emergency Advance
notwithstanding that, at the time such advance is made, the Special Servicer may
not have adequate information available in order to make a determination whether
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or not such advance would, if made, be a Nonrecoverable Servicing Advance. In
addition, Nonrecoverable Servicing Advances (including any Emergency Advances
made pursuant to the proviso of the preceding sentence which are ultimately
determined to be Nonrecoverable Servicing Advances) shall be reimbursable
pursuant to Section 3.05 out of general collections on the Mortgage Loans and
REO Properties on deposit in the Certificate Account. The determination by the
Master Servicer, the Special Servicer or, if applicable, the Trustee or the
Fiscal Agent, that it has made a Nonrecoverable Servicing Advance or that any
proposed Servicing Advance, if made, would constitute a Nonrecoverable Servicing
Advance, shall be evidenced by an Officer's Certificate delivered promptly to
the Trustee (or, if applicable, retained thereby) and the Depositor, setting
forth the basis for such determination, together with (if such determination is
prior to the liquidation of the related Mortgage Loan or REO Property) a copy of
an Appraisal of the related Mortgaged Property or REO Property, as the case may
be, which shall have been performed within the twelve months preceding such
determination, and further accompanied by any other information, including,
without limitation, engineers' reports, environmental surveys, inspection
reports, rent rolls, income and expense statements or similar reports, that the
Master Servicer or the Special Servicer may have obtained and that supports such
determination. If such an Appraisal shall not have been required and performed
pursuant to the terms of this Agreement, the Master Servicer, the Special
Servicer, the Trustee or the Fiscal Agent, as the case may be, may, subject to
its reasonable and good faith determination that such Appraisal will demonstrate
the nonrecoverability of the related Advance, obtain an Appraisal for such
purpose at the expense of the Trust Fund. The Trustee or the Fiscal Agent shall
be entitled to rely on any determination of nonrecoverability that may have been
made by the Master Servicer or the Special Servicer with respect to a particular
Servicing Advance, and the Master Servicer shall be entitled to rely on any
determination of nonrecoverability that may have been made by the Special
Servicer with respect to a particular Servicing Advance.
SECTION 3.12 Inspections; Collection of Financial Statements.
(a) The Master Servicer shall perform (or cause to be performed) a physical
inspection of each Mortgaged Property (other than Mortgaged Properties
constituting collateral for Specially Serviced Mortgaged Loans) at such times
and in such manner as are consistent with the Servicing Standard, but in any
event at least once every two years (or, if the related Mortgage Loan has a
current balance of greater than $2,000,000, at least once every year). The
Master Servicer shall prepare (or cause to be prepared) a written report of each
such inspection detailing the condition of the Mortgaged Property and specifying
the existence of (i) any vacancy in the Mortgaged Property evident from such
inspection that the Master Servicer deems material, (ii) any sale, transfer or
abandonment of the Mortgaged Property evident from such inspection, (iii) any
adverse change in the condition or value of the Mortgaged Property evident from
such inspection that the Master Servicer deems material, or (iv) any waste
committed on the Mortgaged Property evident from such inspection. The Master
Servicer, upon request, shall deliver to the Trustee a copy of each such written
report within 60 days of its preparation.
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(b) The Special Servicer shall perform (or cause to be performed) a
physical inspection of each Mortgaged Property constituting collateral for a
Specially Serviced Mortgage Loan at such times and in such manner as are
consistent with the Servicing Standard. If any Mortgage Loan becomes a Specially
Serviced Mortgage Loan, then as soon as practicable (and in any event within 90
days thereafter) the Special Servicer shall perform (or cause to be performed) a
physical inspection of each Mortgaged Property constituting collateral for such
Mortgage Loan. The Special Servicer shall prepare (or cause to be prepared) a
written report of each such inspection detailing the condition of the Mortgaged
Property and specifying the existence of (i) any vacancy in the Mortgaged
Property evident from such inspection that the Special Servicer deems material,
(ii) any sale, transfer or abandonment of the Mortgaged Property evident from
such inspection, (iii) any adverse change in the condition or value of the
Mortgaged Property evident from such inspection that the Special Servicer deems
material, or (iv) any waste committed on the Mortgaged Property evident from
such inspection. The Special Servicer, upon request, shall deliver to the
Trustee and the Master Servicer a copy of each such written report within 60
days of its preparation.
(c) The Master Servicer (or, in the case of Specially Serviced Mortgage
Loans, the Special Servicer) shall make reasonable efforts to collect promptly
from each Mortgagor quarterly and annual operating statements and rent rolls of
the related Mortgaged Property, and financial statements of such Mortgagor, if
delivery of such items is required pursuant to the terms of the related
Mortgage. In addition, the Special Servicer shall make reasonable efforts to
obtain quarterly and annual operating statements and rent rolls with respect to
each REO Property. The Master Servicer and Special Servicer, upon request, shall
each deliver copies of the collected items to the other such party and the
Trustee in each case within 10 days of its receipt of such request.
SECTION 3.13 Annual Statement as to Compliance.
Each of the Master Servicer and the Special Servicer will deliver to the
Trustee, with a copy to the Depositor, on or before April 30th of each year,
beginning in 1999, an Officer's Certificate stating, as to the 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 in all
material respects its obligations under this Agreement 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 the Trust Fund as a REMIC from the Internal Revenue Service or any other
governmental agency or body or, if it has received any such notice, specifying
the details thereof. A copy of such Officer's Certificate may be obtained by
Certificateholders upon written request to the Trustee pursuant to Section 8.12
hereof.
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SECTION 3.14 Reports by Independent Public Accountants.
On or before April 30th of each year, beginning in 1999, the Master
Servicer at its expense shall cause a firm of independent public accountants
(which may also render other services to the Master Servicer) and that is a
member of the American Institute of Certified Public Accountants to furnish a
statement to the Trustee and to the Depositor to the effect that (i) it has
obtained a letter of representation regarding certain matters from the
management of the Master Servicer, which includes an assertion that the Master
Servicer has complied with certain minimum mortgage loan servicing standards (to
the extent applicable to commercial and multifamily mortgage loans), identified
in the Uniform Single Attestation Program for Mortgage Bankers established by
the Mortgage Bankers Association of America, with respect to the servicing of
commercial and multifamily mortgage loans during the most recently completed
calendar year and (ii) on the basis of an examination conducted by such firm in
accordance with standards established by the American Institute of Certified
Public Accountants, such representation is fairly stated in all material
respects, subject to such exceptions and other qualifications that may be
appropriate. In rendering its report such firm may rely, as to matters relating
to the direct servicing of commercial and multifamily mortgage loans by
Sub-Servicers, upon comparable reports of firms of independent certified public
accountants rendered on the basis of examinations conducted in accordance with
the same standards (rendered within one year of such report) with respect to
those Sub-Servicers.
The Special Servicer will deliver an annual accountants' report only if,
and in such form as may be, requested by the Rating Agencies.
The Master Servicer and the Special Servicer, to the extent applicable,
will use reasonable efforts to cause the accountants referred to above to
cooperate with the Depositor in conforming any reports delivered pursuant to
this Section 3.14 to requirements imposed by the Commission on the Depositor in
connection with the Commission's issuance of a no-action letter relating to the
Depositor's reporting requirements in respect of the Trust Fund pursuant to the
Exchange Act.
SECTION 3.15 Access to Certain Information.
Each of the Master Servicer and the Special Servicer shall provide or cause
to be provided to the Trustee, and to the OTS, the FDIC, and any other federal
or state banking or insurance regulatory authority that may exercise authority
over any Certificateholder, access to any documentation regarding the Mortgage
Loans and the Trust Fund within its control which may be required 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 Master Servicer or the Special Servicer, as the case may be,
designated by it.
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SECTION 3.16 Title to REO Property; REO Account.
(a) If title to any REO Property is acquired, the deed or certificate of
sale shall be issued to the Trustee on behalf of the Certificateholders. The
Special Servicer, on behalf of the Trust Fund, shall attempt to sell any REO
Property within two years of acquiring ownership of such REO Property for
purposes of Section 860G(a)(8) of the Code, unless the Special Servicer either
(i) 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 and the Special Servicer, to the effect that
the holding by the Trust Fund of such REO Property subsequent to the close of
such period will not (subject to Section 10.01(f)) result in the imposition of
taxes on "prohibited transactions" of REMIC I, REMIC II or REMIC III as defined
in Section 860F of the Code or cause REMIC I, REMIC II or REMIC III to fail to
qualify as a REMIC (for federal (or any applicable state or local) income tax
purposes) 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 period longer than three years 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 being
granted 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 cause all funds collected and received in
connection with any REO Property to be held separate and apart from its own
funds and general assets. If any REO Acquisition shall occur, the Special
Servicer shall establish and maintain (or cause to be established and
maintained) one or more accounts (collectively, the "REO Account"), to be 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 and may consist of one account for some
or all the REO Properties. The Special Servicer shall deposit, or cause to be
deposited, in the REO Account, within two Business Days of receipt, all REO
Revenues, Liquidation Proceeds (net of all Liquidation Expenses paid therefrom)
and Insurance Proceeds received in respect of an REO Property. The Special
Servicer is authorized to pay out of related Liquidation Proceeds any
Liquidation Expenses incurred in respect of an REO Property and outstanding at
the time such proceeds are received. Funds in the REO Account may be invested in
Permitted Investments in accordance with Section 3.06. The Special Servicer
shall be entitled to make withdrawals from the REO Account to pay itself, as
additional servicing compensation in accordance with Section 3.11 (d), interest
and investment income earned in respect of amounts held in the REO Account as
provided in Section 3.06 (b) (but only to the extent of the Net Investment
Earnings with respect to the REO Account for any Collection Period). The Special
Servicer shall give notice to the Trustee and the Master Servicer of the
location of any REO Account when first established and of the new location of
such REO Account prior to any change thereof.
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(c) The Special Servicer shall cause all funds necessary for the proper
operation, management, maintenance, disposition and liquidation of any REO
Property to be withdrawn from the REO Account, but only to the extent of amounts
on deposit in the REO Account relating to such REO Property. Within one Business
Day following the end of each Collection Period, the Special Servicer shall
withdraw from the REO Account and deposit into the Certificate Account or
deliver to the Master Servicer (which shall deposit such amounts into the
Certificate Account) the aggregate of all amounts received in respect of each
REO Property during such Collection Period, net of any withdrawals made out of
such amounts pursuant to Section 3.16 (b) or this Section 3.16(c); provided that
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, maintenance and disposition of the related REO
Property (including without limitation the creation of a reasonable reserve for
repairs, replacements and necessary capital improvements and other related
expenses), such reserve not to exceed an amount sufficient to cover such items
to be incurred during the following twelve-month period.
(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).
SECTION 3.17 Management of REO Property; Independent Contractors.
(a) Prior to the acquisition of title to any Mortgaged Property securing a
Defaulted Mortgage Loan, 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, in its good faith and reasonable judgment,
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
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(iii) Directly Operating such property as REO Property could result in
income subject to an REO Tax and, in the good faith and reasonable judgment of
the Special Servicer, 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 Trustee, 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 Trustee shall consult with the Special Servicer and shall advise the Special
Servicer of the Trust Fund'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 Trustee shall (to the maximum extent possible)
advise the Special Servicer of the estimated amount of taxes that the Trust Fund
would be required to pay with respect to each such source of income. After
receiving the information described in the two preceding sentences from the
Trustee, the Special Servicer shall either (A) implement the Proposed Plan
(after acquiring the respective Mortgaged Property as REO Property) or (B)
manage and operate such property in a manner that would not result in the
imposition of an REO Tax on the income derived from such property.
The Special Servicer's decision as to how each REO Property shall be
managed and operated shall in any event be based on the good faith and
reasonable judgment of the Special Servicer as to which means would (to the
extent commercially feasible) maximize the net after-tax REO Revenues received
by the Trust Fund with respect to such property without materially and adversely
affecting the Special Servicer's ability to sell such REO Property in accordance
with this Agreement and, to the extent consistent with the foregoing, in
accordance with the Servicing Standard. Both the Special Servicer and the
Trustee may consult with counsel knowledgeable in such matters at the expense of
the Trust Fund in connection with determinations required under this Section
3.17(a). Neither the Special Servicer nor the Trustee shall be liable to the
Certificateholders, the Trust Fund, the other parties hereto or each other for
errors in judgment made in good faith in the reasonable exercise of their
discretion while performing their respective responsibilities under this Section
3.17(a) or, to the extent it relates to federal income tax consequences for the
Trust Fund, Section 3.17(b) below. Nothing in this Section 3.17(a) is intended
to prevent the sale of a Defaulted Mortgage Loan or REO Property pursuant to the
terms and subject to the conditions of Section 3.18.
(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 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 permitted by Section 3.17(a), result in the receipt by the Trust Fund
of any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code or any "net income from foreclosure property" which is
subject to taxation under the REMIC Provisions. 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 in the best interests
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of and for the benefit of the Certificateholders (as determined by the Special
Servicer in its good faith and reasonable judgment) and, consistent therewith,
shall withdraw from the REO Account, to the extent of amounts on deposit therein
with respect to each REO Property, funds necessary for the proper operation,
management and maintenance of such REO Property, including, without limitation:
(i) all insurance premiums due and payable in respect of such REO Property;
(ii) all real estate taxes and assessments in respect of such REO Property
that may result in the imposition of a lien thereon;
(iii) any ground rents in respect of such REO Property; and
(iv) all costs and expenses necessary to maintain such REO Property.
To the extent that amounts on deposit in the REO Account in respect of any REO
Property are insufficient for the purposes set forth in clauses (i) - (iv) above
with respect to such REO Property, the Special Servicer shall advance such
amount as is necessary for such purposes (which advances shall be Servicing
Advances) unless (as evidenced by an Officer's Certificate delivered to the
Trustee) such advances would, if made, constitute Nonrecoverable Servicing
Advances; provided, however, that the Special Servicer shall make any such
Servicing Advance if it is a necessary fee or expense incurred in connection
with the defense or prosecution of legal proceedings and such advance will be
deemed to constitute a recoverable Servicing Advance.
(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 an expense of
the Trust Fund) shall be reasonable and customary in light of the nature and
locality of the REO Property;
(iii) any such contract shall require, or shall be administered to require,
that the Independent Contractor (A) pay, out of related REO Revenues, all costs
and expenses incurred in connection with the operation and management of such
REO Property, including, without limitation, those listed in subsection (b)
hereof, and (B) remit all related REO Revenues (net of its fees and such costs
and expenses) to the Special Servicer;
(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
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Special Servicer of any of its duties and obligations hereunder with respect to
the operation and management of any such REO Property; and
(v) the Special Servicer shall be obligated with respect thereto to the
same extent as if it alone were performing all duties and obligations in
connection with the operation and management of such REO Property.
The Special Servicer shall be entitled to enter into any agreement with any
Independent Contractor performing services for it related to its duties and
obligations hereunder for indemnification of the Special Servicer by such
Independent Contractor, and nothing in this Agreement shall be deemed to limit
or modify such indemnification.
SECTION 3.18 Sale of Defaulted Mortgage Loans and REO Properties.
(a) The parties hereto may sell or purchase, or permit the sale or purchase
of, a Mortgage Loan or REO Property only on the terms and subject to the
conditions set forth in this Section 3.18 or as otherwise expressly provided in
or contemplated by Sections 2.03(a) and 9.01.
(b) In the event that any Mortgage Loan becomes a Defaulted Mortgage Loan
and the Special Servicer has determined in good faith that such Defaulted
Mortgage Loan will become subject to foreclosure proceedings, the Special
Servicer shall promptly so notify, in writing, the Master Servicer and the
Trustee, and the Trustee shall so notify, in writing, within 10 days after
receipt of its notice, the Holders of the Controlling Class. The Majority
Certificateholder of the Controlling Class may at its (or their) option purchase
from the Trust Fund, at a price equal to the Purchase Price, any such Defaulted
Mortgage Loan. The Purchase Price for any Defaulted Mortgage Loan purchased
hereunder shall be deposited into the Certificate Account, and the Trustee, upon
receipt of an Officer's Certificate from the Master Servicer to the effect that
such deposit has been made, shall release or cause to be released to the
Majority Certificateholder of the Controlling Class (or any designee thereof)
the related Mortgage File, and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, as shall be necessary to
vest in the Majority Certificateholder of the Controlling Class (or any designee
thereof) ownership of such Defaulted Mortgage Loan. In connection with any such
purchase, the Special Servicer shall deliver the related Credit File to such
Certificateholder(s).
(c) If the Majority Certificateholder of the Controlling Class has not
purchased any Defaulted Mortgage Loan within 15 days of its having received
notice in respect thereof pursuant to the immediately preceding subsection (b),
either the Special Servicer or, subject to the Special Servicer's prior rights
in such regard, the Master Servicer may at its option, within 15 days after
receipt of such notice, purchase such Defaulted Mortgage Loan from the Trust
Fund, at a price equal to the Purchase Price. The Purchase Price for any
Defaulted Mortgage Loan purchased hereunder shall be deposited into the
Certificate Account, and the Trustee, upon
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receipt of an Officer's 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, representation or warranty, as shall be necessary to vest
in the Master Servicer or the Special Servicer, as applicable, such Defaulted
Mortgage Loan. In connection with any such purchase by the Master Servicer, the
Special Servicer shall deliver the related Credit File to the Master Servicer.
(d) The Special Servicer may offer to sell any Defaulted Mortgage Loan not
otherwise purchased by the Majority Certificateholder of the Controlling Class,
the Master Servicer or the Special Servicer pursuant to subsection (b) or (c)
above, if and when the Special Servicer determines, consistent with the
Servicing Standard, that such a sale would produce a greater recovery to
Certificateholders on a present value basis than would liquidation of the
related Mortgaged Property. Such offering 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, loan
status, condition and similar customary matters, if liability for breach thereof
is limited to recourse against the Trust Fund) for a period of not less than 10
days or more than 90 days. Unless the Special Servicer determines that
acceptance of any offer would not be in the best economic interests of the Trust
Fund, the Special Servicer shall accept the highest cash offer received from any
Person that constitutes a fair price for such Mortgage Loan. In the absence of
any offer 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 and, otherwise, in accordance with the Servicing Standard.
The Special Servicer shall use reasonable efforts to solicit offers 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 contemporaneously
received, highest) cash bid received from any Person that constitutes a fair
price for such REO Property. If the Special Servicer determines, in its good
faith and reasonable judgment, that it will be unable to realize a fair price
for any REO Property within the time constraints imposed by Section 3.16(a),
then 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
Defaulted Mortgage Loan or REO Property. No Interested Person shall be obligated
to submit a bid to purchase any Defaulted 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.
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(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, if the highest bidder is a
Person other than an Interested Person, and by the Trustee, if the highest
bidder is an Interested Person; provided, however, that no bid from an
Interested Person shall constitute a fair price unless (i) it is the highest bid
received and (ii) at least two other bids are received from independent third
parties. In determining whether any offer received from an Interested Person
represents a fair price for any such Mortgage Loan or REO Property, the Trustee
shall be supplied with and shall rely on the most recent Appraisal or updated
Appraisal conducted in accordance with this Agreement within the preceding 12-
month period or, in the absence of any such Appraisal, on a narrative appraisal
prepared by a Qualified Appraiser, retained by the Special Servicer. Such
appraiser shall be selected by the Special Servicer if the Special Servicer is
not making an offer with respect to a Defaulted Mortgage Loan or REO Property
and shall be selected by the Master Servicer if the Special Servicer is making
such an offer. The cost of any such narrative appraisal shall be covered by, and
shall be reimbursable as, a Servicing Advance. In determining whether any offer
from a Person other than an Interested Person 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, updated Appraisal or narrative
Appraisal that it may have obtained pursuant to this Agreement within the prior
12 months), and in determining whether any offer from an Interested Person
constitutes a fair price for any such Mortgage Loan or REO Property, any
appraiser shall be instructed to take into account, as applicable, among other
factors, the period and amount of any delinquency on the affected Defaulted
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 Defaulted Mortgage Loan or REO Property shall in all
cases be deemed a fair price.
(f) Subject to subsections (a) through (e) above, the Special Servicer
shall act on behalf of the Trust Fund in negotiating and taking any other action
necessary or appropriate in connection with the sale of any 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
offerors, and may retain, fees that approximate the Special Servicer's actual
costs in the preparation and delivery of information pertaining to such sales or
exchanging offers without obligation to deposit such amounts into the
Certificate Account. Any sale of a Defaulted Mortgage Loan or any REO Property
shall be final and without recourse to the Trustee or the Trust Fund (except
such recourse to the Trust Fund imposed by those representations and warranties
typically given in such transactions, any prorations applied thereto and any
customary closing matters), and if such sale is consummated in accordance with
the terms of this Agreement, none of the Special Servicer, the Master Servicer,
the Depositor, the Fiscal Agent or 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, as evidenced by an Opinion of Counsel, a sale for other
consideration will not cause an Adverse REMIC Event).
(h) Notwithstanding any of the foregoing paragraphs of this Section 3.18,
the Special Servicer shall not be obligated to accept the highest cash offer if
the Special Servicer determines, in its reasonable and good faith judgment, that
rejection of such offer would be in the best interests of the
Certificateholders, and the Special Servicer may accept a lower cash offer (from
any Person other than itself or an Affiliate) if it determines, in its
reasonable and good faith judgment, that acceptance of such offer would be in
the best interests of the Certificateholders (for example, if the prospective
buyer making the lower offer is more likely to perform its obligations or the
terms offered by the prospective buyer making the lower offer are more
favorable).
SECTION 3.19 Additional Obligations of the Master Servicer and the Special
Servicer.
(a) In connection with each Adjustable Rate Mortgage Loan (and, if and to
the extent applicable, any successor REO Loan), the Master Servicer shall
calculate adjustments in the Mortgage Rate and the Monthly Payment and shall
notify the Mortgagor of such adjustments, all in accordance with the Mortgage
Note and applicable law. In the event the Index for any Adjustable Rate Mortgage
Loan (or successor REO Loan) is not published or is otherwise unavailable, the
Master Servicer shall select a comparable alternative index with respect to such
Mortgage Loan (or successor REO Loan) over which it has no direct control, which
is readily verifiable and which is acceptable under the terms of the related
Mortgage Note.
(b) The Master Servicer and the Special Servicer, as applicable, shall each
deliver to the other and to the Trustee (for inclusion in the Mortgage File)
copies of all Appraisals, environmental reports and engineering reports (or, in
each case, updates thereof) obtained with respect to any Mortgaged Property or
REO Property.
(c) No more frequently than once per calendar month, the Special Servicer
may require the Master Servicer, and the Master Servicer shall be obligated,
subject to the second following paragraph, to reimburse the Special Servicer for
any Servicing Advances made by but not previously reimbursed to the Special
Servicer, and to pay the Special Servicer interest thereon at the Reimbursement
Rate from the date made to, but not including, the date of reimbursement. Such
reimbursement and any accompanying payment of Advance Interest shall be made
within ten (10) days of the request therefor by wire transfer of immediately
available funds to an account designated by the Special Servicer. Upon the
Master Servicer's reimbursement to the Special Servicer of any Servicing Advance
and payment to the Special Servicer of interest thereon, all in accordance with
this Section 3.19(c), the Master Servicer shall for all purposes of this
Agreement be deemed to have made such Servicing Advance at the same time as the
Special Servicer originally made such Advance, and accordingly, the Master
Servicer
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shall be entitled to reimbursement for such Advance, together with interest
thereon, at the same time, in the same manner and to the same extent as the
Master Servicer would otherwise have been entitled if it had actually made such
Servicing Advance.
Notwithstanding anything to the contrary contained in this Agreement, if
the Special Servicer is required under this Agreement to make any Servicing
Advance but does not desire to do so, the Special Servicer may, in its sole
discretion, request that the Master Servicer make such Advance, such request to
be made in writing and in a timely manner that does not materially and adversely
affect the interests of any Certificateholder. Subject to the following
paragraph, the Master Servicer shall have the obligation to make any such
Servicing Advance that it is requested by the Special Servicer to make within
ten days of the Master Servicer's receipt of such request. The Special Servicer
shall be relieved of any obligations with respect to an Advance that it requests
the Master Servicer to make (regardless of whether or not the Master Servicer
shall make such Advance). The Master Servicer shall be entitled to reimbursement
for any Servicing Advance made by it at the direction of the Special Servicer,
together with Advance Interest thereon, at the same time, in the same manner and
to the same extent as the Master Servicer is entitled with respect to any other
Servicing Advance made thereby. If the Special Servicer makes any Servicing
Advances in accordance with the terms of this Agreement, the Special Servicer
shall notify the Master Servicer in writing within one Business Day of any such
Servicing Advance.
Notwithstanding the foregoing provisions of this Section 3.19(c), the
Master Servicer shall not be required to make at the Special Servicer's
direction, or to reimburse the Special Servicer for, any Servicing Advance if
the Master Servicer determines in its reasonable, good faith judgment that the
Servicing Advance which the Special Servicer is directing the Master Servicer to
make or to reimburse to the Special Servicer hereunder either (y) although not
characterized by the Special Servicer as a Nonrecoverable Servicing Advance, is
or would be, if made, a Nonrecoverable Servicing Advance, or (z) the making of
such advance was or would be in violation of the Servicing Standard or the terms
and conditions of this Agreement. The Master Servicer shall notify the Special
Servicer in writing of such determination. Such notice shall not obligate the
Special Servicer to make any such proposed Servicing Advance.
(d) Upon the earliest of (i) the date on which any Mortgage Loan becomes a
Modified Mortgage Loan, (ii) the 90th day following the occurrence of any
uncured delinquency in Monthly Payments with respect to any Mortgage Loan, (iii)
the date on which a receiver is appointed and continues in such capacity in
respect of the Mortgaged Property securing any Mortgage Loan and (iv) the date
on which the Mortgaged Property securing any Mortgage Loan becomes an REO
Property (each such Mortgage Loan and any related REO Loan, a "Required
Appraisal Loan"), the Special Servicer, shall request and, within 30 days of the
occurrence of such event (or such longer period as the Special Servicer is (as
certified thereby to the Trustee in writing) diligently and in good faith
proceeding to obtain such) obtain an Appraisal of the related Mortgaged
Property; unless an Appraisal thereof had previously been obtained within the
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prior twelve months. The cost of such Appraisal shall be covered by, and
reimbursable as, a Servicing Advance.
With respect to each Required Appraisal Loan (unless such loan has become a
Corrected Mortgage Loan and has remained current for twelve consecutive Monthly
Payments, and no other Servicing Transfer Event has occurred with respect
thereto during the preceding twelve months), the Special Servicer shall, within
30 days of each anniversary of such loan's becoming a Required Appraisal Loan,
order an update of the prior Appraisal (the cost of which will be covered by,
and reimbursable as, a Servicing Advance). Based upon such Appraisal, the
Special Servicer shall determine and report to the Trustee the Appraisal
Reduction Amount, if any, with respect to such loan. The Special Servicer shall
deliver a copy of any such Appraisal to the Master Servicer.
(e) The Master Servicer shall deliver to the Trustee for deposit in the
Distribution Account on each Master Servicer Remittance Date, without any right
of reimbursement therefor, an amount equal to the aggregate of all Balloon
Payment Interest Shortfalls incurred in connection with Balloon Payments
received in respect of the Mortgage Pool during the most recently ended
Collection Period.
(f) The Master Servicer shall deliver to the Trustee for deposit in the
Distribution Account on each Master Servicer Remittance Date, without any right
of reimbursement therefor, an amount equal to the lesser of (i) the aggregate of
all Prepayment Interest Shortfalls incurred in connection with Principal
Prepayments received in respect of the Mortgage Pool during the most recently
ended Collection Period, and (ii) the aggregate Master Servicing Fees received
by the Master Servicer during such Collection Period.
(g) With respect to all ARD Loans, the Master Servicer shall apply all
Monthly Payments and any other sums due, in accordance with the terms of the
related ARD Loan.
(h) With respect to all ARD Loans, the Master Servicer and the Special
Servicer shall not take any enforcement action with respect to the payment of
Excess Interest or principal in excess of the principal component of the
constant Monthly Payment, other than request for collection, until the maturity
date of the related Loan. The foregoing shall not limit the Servicer and Special
Servicer's obligation to establish a Lock-Box Account pursuant to Section 3.24.
If a Mortgagor elects not to repay the principal due and outstanding on an ARD
Loan on its Anticipated Repayment Date, the Master Servicer shall notify any
such Mortgagor that the Revised Rate for such Mortgage Loan shall not exceed the
related initial Mortgage Rate plus 2.00%.
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SECTION 3.20 Modifications, Waivers, Amendments and Consents.
(a) The Master Servicer and the Special Servicer each may agree to any
modification, waiver or amendment of any term of, forgive interest on and
principal of, capitalize interest on, permit the release, addition or
substitution of collateral securing, and/or permit the release of the Mortgagor
on or any guarantor of any Mortgage Loan it is required to service and
administer hereunder, without the consent of the Trustee or any
Certificateholder, subject, however, to each of the following limitations,
conditions and restrictions:
(i) other than as provided in Sections 3.02 and 3.08, the Master Servicer
(in such capacity) shall not agree to any modification, waiver or amendment of
any term of, or take any of the other acts referenced in this Section 3.20(a)
with respect to, any Mortgage Loan that would affect the amount or timing of any
related payment of principal, interest or other amount payable thereunder or, in
the Master Servicer's good faith and reasonable judgment, materially impair the
security for such Mortgage Loan or reduce the likelihood of timely payment of
amounts due thereon; the Special Servicer (in such capacity) may, however, agree
to any modification, waiver or amendment of any term of, or take any of the
other acts referenced in this Section 3.20(a) with respect to, a Specially
Serviced Mortgage Loan that would have any such effect, but only if, in the
Special Servicer's reasonable and good faith judgment, a material default on
such Mortgage Loan has occurred or a default in respect of payment on such
Mortgage Loan is reasonably foreseeable, and such modification, waiver,
amendment or other action is reasonably likely to produce a greater recovery to
Certificateholders on a present value basis, than would liquidation.
(ii) With respect to the Senior Living Loan, the Master Servicer and the
Special Servicer, as applicable, upon receipt of a Rating Agency Confirmation,
may agree to any increase, defeasance or revision of the Surety Bond in
accordance with the terms of the Surety Bond and the Senior Living Subrogation
Agreement;
(iii) neither the Master Servicer nor the Special Servicer may extend the
Stated Maturity Date of any Mortgage Loan beyond the date that is two years
prior to the Rated Final Distribution Date;
(iv) neither the Master Servicer nor the Special Servicer shall make or
permit any modification, waiver or amendment of any term of, or take any of the
other acts referenced in this Section 3.20(a) with respect to, any Mortgage Loan
that would (A) cause REMIC I, REMIC II or REMIC III to fail to qualify as a
REMIC under the Code or (subject to Section 10.01(f)) result in the imposition
of any tax on "prohibited transactions" or "contributions" after the Startup Day
of any such REMIC under the REMIC Provisions or (B) cause any Mortgage Loan to
cease to be a "qualified mortgage" within the meaning of Section 860G(a)(3) of
the Code (neither the Master Servicer nor the Special Servicer shall be liable
for judgments as regards decisions made under this subsection which were made in
good faith and, unless it would
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constitute bad faith or negligence to do so, each of the Master Servicer and the
Special Servicer may rely on opinions of counsel in making such decisions);
(v) neither the Master Servicer nor the Special Servicer shall permit any
Mortgagor to add or substitute any collateral for an outstanding Mortgage Loan,
which collateral constitutes real property, unless the Master Servicer or the
Special Servicer, as the case may be, shall have first determined, in its
reasonable and good faith judgment, based upon an Environmental Assessment (and
such additional environmental testing as the Master Servicer or Special
Servicer, as the case may be, deems necessary and appropriate) prepared by an
Independent Person who regularly conducts Environmental Assessments (and such
additional environmental testing), at the expense of the Mortgagor, that such
additional or substitute collateral is in compliance with applicable
environmental laws and regulations and that there are no circumstances or
conditions present with respect to such new collateral relating to the use,
management or disposal of any Hazardous Materials for which investigation,
testing, monitoring, containment, clean-up or remediation would be required
under any then applicable environmental laws and/or regulations; and
(vi) neither the Master Servicer nor the Special Servicer shall release or
substitute any collateral securing an outstanding Mortgage Loan except as
provided in Section 3.09(d) and except in the case of a release where (A) the
use of the collateral to be released will not, in the Master Servicer's or
Special Servicer's, as the case may be, good faith and reasonable judgment,
materially and adversely affect the Net Operating Income being generated by or
the use of the related Mortgaged Property, (B) there is a corresponding
principal paydown of such Mortgage Loan in an amount at least equal to, or a
delivery of substitute collateral with an appraised value at least equal to, the
appraised value of the collateral to be released, (C) the remaining Mortgaged
Property and any substitute collateral is, in the Master Servicer's or Special
Servicer's, as the case may be, good faith and reasonable judgment, adequate
security for the remaining Mortgage Loan and (D) such release and/or
substitution would not result in the downgrade, qualification or withdrawal of
the rating then assigned by any Rating Agency to any Class of Certificates (as
confirmed in writing by each Rating Agency);
provided that (x) the limitations, conditions and restrictions set forth in
clauses (i) through (vi) above shall not apply to any modification of any term
of any Mortgage Loan or any other acts referenced in this Section 3.20(a) that
is required under the terms of such Mortgage Loan in effect on the Closing Date,
and (y) notwithstanding clauses (i) through (vi) above, neither the Master
Servicer nor the Special Servicer shall be required to oppose the confirmation
of a plan in any bankruptcy or similar proceeding involving a Mortgagor if in
their reasonable and good faith judgment such opposition would not ultimately
prevent the confirmation of such plan or one substantially similar. Neither the
Master Servicer nor the Special Servicer may extend the Maturity Date on any
Mortgage Loan except pursuant to this Section 3.20(a) or as otherwise required
under the related loan documents.
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(b) Neither the Master Servicer nor the Special Servicer shall have any
liability to the Trust Fund, the Certificateholders or any other Person if its
analysis and determination that the modification, waiver, amendment or other
action contemplated by Section 3.20(a) is reasonably likely to produce a greater
recovery to Certificateholders on a present value basis than would liquidation,
should prove to be wrong or incorrect, so long as the analysis and determination
were made on a reasonable basis in good faith by the Special Servicer and the
Special Servicer was not negligent in ascertaining the pertinent facts.
(c) Any payment of interest, which is deferred pursuant to any
modification, waiver or amendment permitted hereunder, shall not, for purposes
hereof, including, without limitation, calculating monthly distributions to
Certificateholders, be added to the unpaid principal balance of the related
Mortgage Loan, notwithstanding that the terms of such Mortgage Loan or such
modification, waiver or amendment so permit.
(d) The Master Servicer and, with respect to a Specially Serviced Mortgaged
Loan, the Special Servicer each may, as a condition to its granting any request
by a Mortgagor for consent, modification, waiver or indulgence or any other
matter or thing, the granting of which is within the Master Servicer's or the
Special Servicer's 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, as additional
servicing compensation, a reasonable or customary fee (not to exceed 1.0% of the
unpaid principal balance of the related Mortgage Loan) for the additional
services performed in connection with such request, together with any related
costs and expenses incurred by it.
(e) Except for waivers of Penalty Charges and notice periods, all material
modifications, waivers and amendments of the Mortgage Loans entered into
pursuant to this Section 3.20 shall be in writing
(f) Each of the Master Servicer and the Special Servicer shall notify the
Trustee and such other party, in writing, of any modification, waiver or
amendment of any term of any Mortgage Loan and the date thereof, and shall
deliver to the Trustee or the related 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 10 Business
Days) following the execution thereof.
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 promptly give notice thereof, and deliver
the related Servicing File, to the Special Servicer and shall use reasonable
efforts to provide the Special Servicer with all information, documents (or
copies thereof) and records (including records stored electronically
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on computer tapes, magnetic discs and the like) relating to the Mortgage Loan
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. The Special Servicer may, as to any delinquent Mortgage Loan,
prior to the occurrence of a Servicing Transfer Event with respect thereto,
request and obtain the foregoing documents and information.
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 promptly give notice thereof, and return
the related Servicing File, to the Master Servicer and upon giving such notice,
and returning such Servicing File, to 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 in accordance with this Agreement shall resume.
Notwithstanding other provisions in this Agreement to the contrary, the
Master Servicer shall remain responsible for the billing and collection,
accounting, data collection, reporting and other basic Master Servicer
administrative functions with respect to Specially Serviced Mortgage Loans,
provided that the Special Servicer shall establish procedures for the Master
Servicer as to the application of receipts and tendered payments and shall have
the exclusive responsibility for and authority over all contacts with and
notices to Mortgagors and similar matters relating to each Specially Serviced
Mortgage Loan and the related Mortgaged Property.
(b) In servicing any Specially Serviced Mortgage Loans, the Special
Servicer shall provide to the Trustee originals of documents included within the
definition of "Mortgage File" for inclusion in the related Mortgage File (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) Notwithstanding anything in this Agreement to the contrary, in the
event that the Master Servicer and the Special Servicer are the same Person, all
notices, certificates, information and consents required to be given by the
Master Servicer to the Special Servicer or vice versa shall be deemed to be
given without the necessity of any action on such Person's part.
SECTION 3.22 Sub-Servicing Agreements.
(a) The Master Servicer and the Special Servicer may each enter into Sub-
Servicing Agreements for the servicing and administration of all or a part of
the Mortgage Loans for which it is responsible hereunder, provided that, in each
case, the Sub-Servicing Agreement: (i) is not inconsistent with this Agreement
and shall provide that the Sub-Servicer will maintain
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errors and omissions insurance and fidelity bond coverage as required of the
Master Servicer or the Special Servicer (whichever retained it) under Section
3.07 hereof; (ii) provides that if the Master Servicer or the Special Servicer,
as the case may be, shall for any reason no longer be the Master Servicer or
Special Servicer, as applicable, hereunder (including, without limitation, by
reason of an Event of Default or their termination hereunder), the Trustee, its
designee or any successor Master Servicer or Special Servicer may thereupon
assume all of the rights and, except to the extent they arose prior to the date
of assumption, obligations of the Master Servicer or the Special Servicer, as
the case may be, under such agreement; (iii) provides that any successor Master
Servicer may terminate such agreement without cause and without payment of any
termination fee; (iv) in the case of a Sub-Servicing Agreement entered into by
the Master Servicer, expressly or effectively provides that (if the Master
Servicer and the Special Servicer are not the same Person) such agreement shall
terminate with respect to any Mortgage Loan serviced thereunder at the time such
Mortgage Loan becomes a Specially Serviced Mortgage Loan; and (v) in the case of
a Sub-Servicing Agreement entered into by the Special Servicer, relates only to
Specially Serviced Mortgage Loans or REO Properties and expressly or effectively
provides that (if the Master Servicer and the Special Servicer are not the same
Person) such agreement shall terminate with respect to any such Mortgage Loan
that becomes a Corrected Mortgage Loan. References in this Agreement to actions
taken or to be taken by the Master Servicer or the Special Servicer, as the case
may be, include actions taken or to be taken by a Sub-Servicer on behalf of the
Master Servicer or the Special Servicer, as the case may be; and, in connection
therewith, all amounts advanced by any Sub-Servicer to satisfy the obligations
of the Master Servicer or the Special Servicer, as the case may be, hereunder to
make Servicing Advances and Delinquency 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 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, and, for so long as they are outstanding, such Advances shall accrue
interest in accordance with Section 3.11(f) or Section 4.03(d), as applicable,
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 the Sub-Servicer receives such
payment.
(b) Each Sub-Servicer 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.
(c) As part of its servicing activities hereunder, 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 each Sub-Servicer
retained by it under the related Sub-Servicing Agreement. 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
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appropriate remedies, shall be in such form and carried out to such an extent
and at such time by the Master Servicer and the Special Servicer in accordance
with the Servicing Standard. The Master Servicer and the Special Servicer each
shall have the right to remove a Sub-Servicer retained by it at any time it
considers such removal to be in the best interests of Certificateholders.
(d) In the event the Trustee, its designee or any successor Master Servicer
or Special Servicer assumes the rights and obligations of the Master Servicer or
the Special Servicer under any Sub-Servicing Agreement, the Master Servicer or
the Special Servicer, as the case may be, at its expense shall, upon request of
the Trustee, deliver to the assuming party all documents and records relating to
such Sub-Servicing Agreement and the Mortgage Loans then being serviced
thereunder and an accounting of amounts collected and held on behalf of it
thereunder, and otherwise use reasonable efforts to effect the orderly and
efficient transfer of the Sub-Servicing Agreement to the assuming party.
(e) Notwithstanding any Sub-Servicing Agreement, the Master Servicer and
the Special Servicer each shall remain obligated and liable to the Trustee and
the Certificateholders for the servicing and administration of the Mortgage
Loans in accordance with the provisions of this Agreement to the same extent and
under the same terms and conditions as if it alone were servicing and
administering the Mortgage Loans for which it is responsible.
SECTION 3.23 Designation of Special Servicer by the Majority
Certificateholder of the Controlling Class.
The Certificateholders entitled to more than 50% of the Voting Rights
allocated to the Controlling Class, may at any time and from time to time
replace any existing Special Servicer or any Special Servicer that has resigned
or otherwise ceased to serve as Special Servicer. Such Holders shall so
designate a Person to so serve by the delivery to the Trustee of a written
notice stating such designation, subject to the approval of the Rating Agencies.
The Trustee shall, promptly after receiving any such notice, so notify the
Rating Agencies. The designated Person shall become the Special Servicer as of
the date the Trustee shall have received: (i) written confirmation from the
Rating Agencies stating that if the designated Person were to serve as Special
Servicer hereunder, none of the then-current ratings of the outstanding Classes
of the Certificates would be qualified, downgraded or withdrawn; (ii) a written
acceptance of all obligations of the Special Servicer under this Agreement,
executed by the designated Person; and (iii) an Opinion of Counsel (at the
expense of the Person designated to become the Special Servicer or the Holders
that made the designation) to the effect that the designation of such Person to
serve as Special Servicer is in compliance with this Section 3.23 and all other
applicable provisions of this Agreement, that upon the execution and delivery of
the written acceptance referred to in the immediately preceding clause (ii), 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. The existing Special Servicer shall be deemed to have resigned
simultaneously with such designated Person's becoming the Special
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Servicer hereunder; provided, however, that (i) 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 (ii) it and its
directors, officers, employees and agents 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 deposited in the REO Account or delivered by the Special Servicer to
the Master Servicer or that are thereafter received with respect to Specially
Serviced Mortgage Loans and REO Properties.
SECTION 3.24 Lock-Box Accounts and Servicing Accounts.
(a) The Master Servicer shall administer each Lock-Box Account, Cash
Collateral Account and Servicing Account in accordance with the related Mortgage
Loan, Cash Collateral Account Agreement or Lock-Box Agreement, if any.
(b) For any Mortgage Loan that provides that a Lock-Box Account or Cash
Collateral Account will be established upon the occurrence of certain events
specified in such Mortgage Loan, the Master Servicer (or, with respect to any
Specially Serviced Loan, the Special Servicer) shall use reasonable efforts to
establish or cause to be established such LockBox Account upon the occurrence of
such events unless the Master Servicer (or the Special Servicer, as applicable)
determines, in accordance with the Servicing Standards, that such LockBox
Account should not be established. Notwithstanding the foregoing, the Master
Servicer (or the Special Servicer, as applicable) shall use reasonable efforts
to establish or cause to be established a Lock-Box Account for each ARD Loan no
later than its Anticipated Repayment Date.
SECTION 3.25 Representations and Warranties of the Master Servicer and the
Special Servicer.
GMACCM, in its capacity as both Master Servicer and Special Servicer
hereunder hereby represents and warrants to the Trustee, for its own benefit and
the benefit of the Certificateholders, and to the Depositor, as of the Closing
Date, that:
(i) GMACCM is a corporation, duly organized, validly existing and in good
standing under the laws of the State of California, and GMACCM 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 GMACCM, and the
performance and compliance with the terms of this Agreement by GMACCM, will not
violate
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GMACCM'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 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) GMACCM 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
the other parties hereto, constitutes a valid, legal and binding obligation of
GMACCM, enforceable against GMACCM 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) GMACCM 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, 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 GMACCM's good faith
and reasonable judgment, is likely to affect materially and adversely either the
ability of GMACCM to perform its obligations under this Agreement or the
financial condition of GMACCM.
(vi) No litigation is pending or, to the best of GMACCM's knowledge,
threatened against GMACCM the outcome of which, in GMACCM's good faith and
reasonable judgment, could reasonably be expected to prohibit GMACCM from
entering into this Agreement or materially and adversely affect the ability of
GMACCM to perform its obligations under this Agreement.
(vii) GMACCM has errors and omissions insurance coverage which is in full
force and effect and complies with the requirements of Section 3.07 hereof.
(viii) No consent, approval, authorization or order, 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 of or
compliance by GMACCM with this Agreement, or the consummation by GMACCM of any
transaction contemplated hereby, other than (1) such consents, approvals,
authorizations, qualifications, registrations, filings, or notices as have been
obtained or made and (2) where the lack of such consent, approval,
authorization, qualification, registration, filing or notice would not have a
material adverse effect on the performance by GMACCM under this Agreement.
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SECTION 3.26 The Senior Living Loan.
(a) Notwithstanding anything herein to the contrary, in connection with any
servicing of the Senior Living Loan pursuant to Sections 3.08, 3.16, 3.17, and
3.18, the Special Servicer shall designate and consult the Senior Living Loan
Consultant and shall consult and cooperate with the Surety (in each case in
accordance with, and to the extent set forth in, the Senior Living Trust
Agreement) in connection with exercising any rights and remedies that the
Special Servicer, on behalf of the Trust Fund, may have with respect to the
Senior Living Loan.
(b) After the occurrence of an event of default under the Senior Living
Loan, the Surety is entitled to purchase the Senior Living Loan in accordance
with Section 4.1 of the Senior Living Subrogation Agreement at a purchase price
equal to the unpaid principal balance of the Senior Living Loan as of the date
of repurchase plus all accrued and unpaid interest thereon. Upon payment of such
purchase price by the Surety, all portions of the Mortgage File and other
documents pertaining to such Mortgage Loan possessed by the Trustee, the Master
Servicer or the Special Servicer, and each document that constitutes a part of
the related Mortgage File that was endorsed or assigned to the Trustee, shall be
endorsed or assigned, as the case may be, to the Surety. Additionally, in
connection with any purchase of the Senior Living Loan by the Surety, the Master
Servicer shall release or cause to be released to the Surety any Reserve Funds
or Escrow Payments with respect to the Senior Living Loan.
(c) Subject to the terms of this Agreement, each of the Master Servicer and
the Special Servicer, as applicable, on behalf of the Trust Fund, is authorized
to take any and all actions required or permitted to be taken by a "Lender" or
"Holder" (as such terms are defined in the Senior Living Trust Agreement) under
the Senior Living Loan and the Senior Living Subrogation Agreement; provided,
however, that when the consent of a "Lender" is required under the related
Senior Living Loan documents in connection with the transfer of ownership
interests in the Mortgagor under the Senior Living Loan, prior to consenting to
any such transfer, the Master Servicer or the Special Servicer, as applicable,
shall have received a Rating Agency Confirmation.
(d) The Master Servicer or Special Servicer, as applicable, shall, upon
receipt of notice from the Senior Living Surety pursuant to the Senior Living
Subrogation Agreement that the Senior Living Surety has elected to discharge its
liability under the Senior Living Surety Bond by depositing the amount required
to effect a defeasance of a portion of principal of the Mortgage Note evidencing
the Senior Living Loan equal to the then "Insured Principal Amount" as defined
in the Senior Living Surety Bond and upon receipt of the items (delivered by the
Senior Living Surety) specified in Section 3.08(c)(iii), (iv), (v), (vi) and
(vii), direct the Senior Living Trustee to release the Senior Living Surety Bond
and to thereafter administer the defeasance collateral so delivered in
accordance with the Senior Living Loan documents.
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ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
AND RELATED MATTERS
SECTION 4.01 Distributions.
(a) On each Distribution Date, the Trustee shall be deemed to apply the
Available Distribution Amount for such date for the following purposes and in
the following order of priority:
(i) to pay interest to REMIC II in respect of the various REMIC I Regular
Interests, up to an amount equal to, and pro rata in accordance with, all
Uncertificated Distributable Interest for each such REMIC I Regular Interest for
such Distribution Date and, to the extent not previously deemed paid, for all
prior Distribution Dates;
(ii) to pay principal to REMIC II in respect of the various REMIC I Regular
Interests, up to an amount equal to, and pro rata in accordance with, in the
case of each such REMIC I Regular Interest for such Distribution Date, 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, REO Loan or, if
applicable, a Replacement Mortgage Loan, as the case may be, that will be
outstanding immediately following such Distribution Date; and
(iii) to reimburse REMIC II for any Realized Losses and Additional Trust
Fund Expenses previously deemed allocated to the various REMIC I Regular
Interests, up to an amount equal to, and pro rata in accordance with, the Loss
Reimbursement Amount for each such REMIC I Regular Interest immediately prior to
such Distribution Date.
On each Distribution Date, the Trustee shall pay to the Holders of the
Class R-I Certificates, in accordance with Section 4.01(c), that portion, if
any, of the Available Distribution Amount for such date that has not otherwise
been deemed paid to REMIC II in respect of the REMIC I Regular Interest pursuant
to the foregoing provisions of this Section 4.01(a) (such portion, the "Class
R-I Distribution Amount" for such Distribution Date).
On each Distribution Date, the Trustee shall be deemed to apply amounts
relating to each Prepayment Premium then on deposit in the Distribution Account
and received during or prior to the related Collection Period, to pay additional
interest to REMIC II in respect of the REMIC I Regular Interest that relates to
the Mortgage Loan or REO Loan, as the case may be, as to which such Prepayment
Premium was received.
All amounts (other than additional interest in the form of amounts relating
to Prepayment Premiums) deemed paid to REMIC II in respect of the REMIC I
Regular Interests
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pursuant to this Section 4.01(a) on any Distribution Date is hereinafter
referred to as the "REMIC II Distribution Amount" for such date.
(b) On each Distribution Date, the Trustee shall be deemed to apply the
REMIC II Distribution Amount for such date for the following purposes and in the
following order of priority:
(i) to pay interest to REMIC III in respect of all REMIC II Regular
Interests up to an amount equal to all Uncertificated Distributable Interest in
respect of such REMIC II Regular Interests for such Distribution Date and, to
the extent not previously deemed paid, for all prior Distribution Dates with
such payments allocated among the REMIC II Regular Interests such that remaining
amounts, if any, of unpaid interest on each such REMIC II Regular Interest will
equate to the remaining unpaid accrued interest on the corresponding Principal
Balance Certificate or Class X Component outstanding after all subsequent
adjustments made on such Distribution Date under Section 4.01(c) below;
(ii) to pay principal to REMIC III in respect of all REMIC II Regular
Interests apportioned as payment of Uncertificated Principal Balance among the
classes of REMIC II Regular Interests such that the remaining Uncertificated
Principal Balance of each such class will equal the then outstanding Principal
Balance of the corresponding Principal Balance Certificate after all subsequent
adjustments made on such Distribution Date under Section 4.01(c) below (other
than payments thereunder in reimbursement of any Realized Losses and Additional
Trust Fund Expenses); and
(iii) to reimburse REMIC III for any Realized Losses and Additional Trust
Fund Expenses previously deemed allocated to REMIC II Regular Interests,
apportioned as payment of Uncertificated Principal Balance among the classes of
REMIC II Regular Interests such that the remaining Uncertificated Balance of
each such class will equal the Principal Balance of the corresponding Principal
Balance Certificate after all subsequent payments made on such Distribution Date
under Section 4.01(c) below.
On each Distribution Date, the Trustee shall pay to the Holders of the
Class R-II Certificates, in accordance with Section 4.01(c), that portion, if
any, of the REMIC II Distribution Amount for such date that has not otherwise
been deemed paid to REMIC III in respect of the REMIC II Regular Interests
pursuant to the foregoing provisions of this Section 4.01(b) (such portion, the
"Class R-II Distribution Amount" for such Distribution Date).
On each Distribution Date, the Trustee shall be deemed to apply all amounts
relating to Prepayment Premiums then on deposit in the Distribution Account and
received during or prior to the related Collection Period, to pay additional
interest to REMIC III in respect of REMIC II Regular Interests among the REMIC
II Regular Interests in an amount with respect to each REMIC II Regular Interest
equal to the amount allocable to the corresponding
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Principal Balance Certificate and Class X Component outstanding after all
subsequent adjustments made on such Distribution Date under Section 4.01(c)
below.
(c) On each Distribution Date, following the deemed payments to REMIC III
in respect of the REMIC II Regular Interests on such date pursuant to Section
4.01(b), the Trustee shall withdraw from the Distribution Account the Available
Distribution Amount for such Distribution Date and shall apply such net amount
for the following purposes and in the following order of priority:
(i) to pay interest to the Holders of the respective Classes of Senior
Certificates, in an amount equal to, and pro rata in accordance with, all
Distributable Certificate Interest in respect of each such Class of
Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(ii) to pay principal first to the Holders of the Class A-1
Certificates and second to the Holders of the Class A-2 Certificates, in
each case, up to an amount equal to the lesser of (1) the then outstanding
Class Principal Balance of such Class of Certificates and (2) the remaining
portion, if any, of such Principal Distribution Amount;
(iii) to reimburse the Holders of the respective Classes of Class A
Certificates, up to an amount equal to and pro rata as among such Classes
in accordance with, the respective amounts of Realized Losses and
Additional Trust Fund Expenses, if any, previously deemed allocated to such
Classes of Certificates and for which no reimbursement has previously been
paid; and
(iv) to make payments on the Subordinated Certificates pursuant to the
following paragraph;
provided that, on each Distribution Date after the aggregate of the Class
Principal Balances of the Subordinated Certificates has been reduced to zero,
and in any event on the Final Distribution Date, the payments of principal to be
made pursuant to clause (ii) above, will be so made to the Holders of the
respective Classes of 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. References to
"remaining Principal Distribution Amount" shall be to the Principal Distribution
Amount net of any distributions of principal made in respect thereof to the
Holders of each Class of Class A Certificates that, pursuant to clause (ii)
above, have a prior right to payment with respect thereto.
On each Distribution Date, following the foregoing series of payments on
the Senior Certificates, the Trustee shall apply the remaining portion, if any,
of the Available
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Distribution Amount for such date for the following purposes and in the
following order of priority:
(i) to pay interest to the Holders of the Class B Certificates, up to 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;
(ii) if the Class Principal Balances of the Class A Certificates have been
reduced to zero, to pay principal to the Holders of the Class B Certificates, up
to an amount equal to the lesser of (A) the then outstanding Class Principal
Balance of such Class of Certificates and (B) the remaining Principal
Distribution Amount for such Distribution Date;
(iii) to reimburse the Holders of the Class B Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been paid;
(iv) to pay interest to the Holders of the Class C Certificates, up to 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;
(v) if the Class Principal Balances of the Class A and Class B Certificates
have been reduced to zero, to pay principal to the Holders of the Class C
Certificates, up to an amount equal to the lesser of (A) the then outstanding
Class Principal Balance of such Class of Certificates and (B) the remaining
Principal Distribution Amount for such Distribution Date;
(vi) to reimburse the Holders of the Class C Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(vi) to pay interest to the Holders of the Class D Certificates, up to 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;
(viii) if the Class Principal Balances of the Class A, Class B and Class C
Certificates have been reduced to zero, to pay principal to the Holders of the
Class D Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of such Class of Certificates and (B) the
remaining Principal Distribution Amount for such Distribution Date;
(ix) to reimburse the Holders of the Class D Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
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(x) to pay interest to the Holders of the Class E Certificates, up to 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;
(xi) if the Class Principal Balances of the Class A, Class B, Class C and
Class D Certificates have been reduced to zero, to pay principal to the Holders
of the Class E Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of such Class of Certificates and (B) the
remaining Principal Distribution Amount for such Distribution Date;
(xii) to reimburse the Holders of the Class E Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(xiii) to pay interest to the Holders of the Class F Certificates, up to 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;
(xiv) if the Class Principal Balances of the Class A, Class B, Class C,
Class D and Class E Certificates have been reduced to zero, to pay principal to
the Holders of the Class F Certificates, up to an amount equal to the lesser of
(A) the then outstanding Class Principal Balance of such Class of Certificates
and (B) the remaining Principal Distribution Amount for such Distribution Date;
(xv) to reimburse the Holders of the Class F Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(xvi) to pay interest to the Holders of the Class G Certificates, up to 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;
(xvii) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E and Class F Certificates have been reduced to zero, to pay
principal to the Holders of the Class G Certificates, up to an amount equal to
the lesser of (A) the then outstanding Class Principal Balance of such Class of
Certificates and (B) the remaining Principal Distribution Amount for such
Distribution Date;
(xviii) to reimburse the Holders of the Class G Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
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(xix) to pay interest to the Holders of the Class H Certificates, up to 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;
(xx) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F and Class G Certificates have been reduced to zero, to
pay principal to the Holders of the Class H Certificates, up to an amount equal
to the lesser of (A) the then outstanding Class Principal Balance of such Class
of Certificates and (B) the remaining Principal Distribution Amount for such
Distribution Date;
(xxi) to reimburse the Holders of the Class H Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(xxii) to pay interest to the Holders of the Class J Certificates, up to 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;
(xxiii) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F, Class G and Class H Certificates have been reduced to
zero, to pay principal to the Holders of the Class J Certificates, up to an
amount equal to the lesser of (A) the then outstanding Class Principal Balance
of such Class of Certificates and (B) the remaining Principal Distribution
Amount for such Distribution Date;
(xxiv) to reimburse the Holders of the Class J Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(xxv) to pay interest to the Holders of the Class K Certificates, up to 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;
(xxvi) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F, Class G, Class H and Class J Certificates have been
reduced to zero, to pay principal to the Holders of the Class K Certificates, up
to an amount equal to the lesser of (A) the then outstanding Class Principal
Balance of such Class of Certificates and (B) the remaining Principal
Distribution Amount for such Distribution Dates;
(xxvii) to reimburse the Holders of the Class K Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
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(xxviii) to pay interest to the Holders of the Class L Certificates, up to
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;
(xxix) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F, Class G, Class H, Class J and Class K Certificates
have been reduced to zero, to pay principal to the Holders of the Class L
Certificates, up to an amount equal to the lesser of (A) the then outstanding
Class Principal Balance of such Class of Certificates and (B) the remaining
Principal Distribution Amount for such Distribution Date;
(xxx) to reimburse the Holders of the Class L Certificates, up to an amount
equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(xxxi) to pay interest to the Holders of the Class M Certificates, up to 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;
(xxxii) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F, Class G, Class H, Class J, Class K and Class L
Certificates have been reduced to zero, to pay principal to the Holders of the
Class M Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of such Class of Certificates and (B) the
remaining Principal Distribution Amount for such Distribution Date;
(xxxiii) to reimburse the Holders of the Class M Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
(xxxiv) to pay interest to the Holders of the Class N Certificates, up to
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;
(xxxv) if the Class Principal Balances of the Class A, Class B, Class C,
Class D, Class E, Class F, Class G, Class H, Class J, Class K, Class L and Class
M Certificates have been reduced to zero, to pay principal to the Holders of the
Class N Certificates, up to an amount equal to the lesser of (A) the then
outstanding Class Principal Balance of such Class of Certificates and (B) the
remaining Principal Distribution Amount for such Distribution Date;
(xxxvi) to reimburse the Holders of the Class N Certificates, up to an
amount equal to all Realized Losses and Additional Trust Fund Expenses, if any,
previously deemed allocated to such Class of Certificates and for which no
reimbursement has previously been received;
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(xxxvii) to make payments to the Holders of the Class R-I Certificates up
to the amount of the Class R-I Distribution Amount for such Distribution Date;
(xxxviii) to make payments to the Holders of the Class R-II Certificates up
to the amount of the Class R-II Distribution Amount for such Distribution Date;
and
(xxxix) to pay to the Holders of the Class R-III Certificates the balance,
if any, of the Available Distribution Amount for such Distribution Date;
provided that, on the Final Distribution Date, the payments of principal to be
made pursuant to any of clauses (ii), (v), (viii), (xi), (xiv), (xvii), (xx),
(xxiii), (xxvi), (xxix), (xxxii) and (xxxv) above with respect to any Class of
Principal Balance Certificates, will be so made to the Holders thereof, up to an
amount equal to the entire then outstanding Class Principal Balance of such
Class of Certificates. References to "remaining Principal Distribution Amount"
in any of clauses (ii), (v), (viii), (xi), (xiv), (xvii), (xx), (xxiii), (xxvi),
(xxix), (xxxii) and (xxxv) above, in connection with the payments of principal
to be made to the Holders of any Class of Principal Balance Certificates, shall
be to the Principal Distribution Amount for such Distribution Date, net of any
payments of principal made in respect thereof to the Holders of each Class of
Principal Balance Certificates that have a higher Payment Priority.
On each Distribution Date, the Trustee shall withdraw any amounts then on
deposit in the Distribution Account that represent Prepayment Premiums collected
during or prior to the related Collection Period and shall distribute such
amounts, in each case, subject to available funds, as additional interest, as
follows:
(i) to the Holders of the Class A, Class B, Class C, Class D, Class E
and Class F Certificates in an aggregate amount up to the product of (a)
such Prepayment Premiums, (b) the Discount Rate Fraction and (c) the
Principal Allocation Fraction of such Class; and
(ii) then, to the Holders of the Class X Certificates.
All of the foregoing distributions to be made from the Distribution Account
on any Distribution Date with respect to the REMIC III Certificates shall be
deemed made from the payments deemed made to REMIC II in respect of the REMIC II
Regular Interests on such Distribution Date pursuant to Section 4.01(b).
(d) All distributions made with respect to each Class on each Distribution
Date shall be allocated pro rata among the outstanding Certificates in such
Class based on their respective Percentage Interests. Except as otherwise
provided below, all such distributions with respect to each Class on each
Distribution Date shall be made to the Certificateholders of the respective
Class of record at the close of business on the related Record Date and shall be
made by wire transfer of immediately available funds to the account of any such
Certificateholder at
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a bank or other entity having appropriate facilities therefor, if such
Certificateholder shall have provided the Trustee with wiring instructions no
less than five Business Days prior to the related Record Date (which wiring
instructions may be in the form of a standing order applicable to all subsequent
Distribution Dates) or otherwise by check mailed to the address of such
Certificateholder as it appears in the Certificate Register. The final
distribution on each Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to such Certificate) will be made in like manner, but only
upon presentation and surrender of such Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to
Certificateholders of such final distribution. 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 Registrar or to any other address of
which the Trustee was subsequently notified in writing.
(e) Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the 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 Certificate Owners that it represents. None of the Trustee, the
Certificate Registrar, the Depositor, the Master Servicer or the Special
Servicer shall have any responsibility therefor except as otherwise provided by
this Agreement or applicable law.
(f) The rights of the Certificateholders to receive distributions from the
proceeds of the Trust Fund in respect of their 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. 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 a reduction of the related Class Principal Balance.
(g) Except as otherwise provided in Section 9.01, whenever the Trustee
expects that the final distribution with respect to any Class of Certificates
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to such Class of
Certificates) will be made on the next Distribution Date, the Trustee shall, as
soon as practicable in the month in which such Distribution Date
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occurs, mail to each Holder of such Class of Certificates as of the date of
mailing a notice to the effect that:
(i) the Trustee 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 offices of the
Certificate Registrar or such other location therein specified, and
(ii) no interest shall accrue on such Certificates from and after the
applicable Interest Accrual Period for such Distribution Date.
Any funds not distributed to any Holder or Holders of Certificates of such Class
on such Distribution Date because of the failure of such Holder or Holders to
tender their Certificates, shall, on such date, be set aside and held uninvested
in trust and credited to the account or accounts of the appropriate
non-tendering Holder or Holders. If any Certificates as to which notice has been
given pursuant to this Section 4.01(g) shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Trustee 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 Trustee, directly or through an agent, shall take such steps
to contact the remaining nontendering 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 Certificateholder on any
amount held in trust hereunder by the Trustee as a result of such
Certificateholder's failure to surrender its Certificate(s) for final payment
thereof in accordance with this Section 4.01(g). If all of the Certificates
shall not have been surrendered for cancellation by the second anniversary of
the delivery of the second notice, the Trustee shall distribute all unclaimed
funds and other assets which remain subject hereto in accordance with applicable
laws.
(h) Notwithstanding any other provision of this Agreement, the Trustee
shall comply with all federal withholding requirements respecting payments to
Certificateholders of interest or original issue discount that the Trustee
reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. In the event the
Trustee does withhold any amount from interest or original issue discount
payments or advances thereof to any Certificateholder pursuant to federal
withholding requirements, the Trustee shall indicate the amount withheld to such
Certificateholders. All amounts withheld shall be deemed to have been paid to
such Certificateholders.
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SECTION 4.02 Statements to Certificateholders; Certain Reports by the
Master Servicer and the Special Servicer.
(a) Subject to Section 8.02(v), based on information received from the
Master Servicer, on each Distribution Date, the Trustee shall forward by mail or
other means as provided herein to all of the Holders of each Class of
Certificates (and, in the case of a Class of Book-Entry Certificates, to each
related Certificate Owner that makes a written request therefor and certifies as
to its Ownership Interest in such Class) and to the Rating Agencies written
reports, including reports in substantially the form attached hereto as Exhibit
G (the "Distribution Date Statement"), setting forth, among other things, the
following information:
(i) the amount of distributions, if any, made on such Distribution Date to
the holders of each Class of Principal Balance Certificates and applied to
reduce the respective Class Principal Balances thereof;
(ii) the amount of distributions, if any, made on such Distribution Date to
the Holders of each Class of REMIC III Regular Certificates allocable to (A)
Distributable Certificate Interest and (B) Prepayment Premiums;
(iii) the amount of any distributions made on such Distribution Date to the
Holders of each Class of Residual Certificates;
(iv) the aggregate amount of outstanding Delinquency Advances as of the end
of the prior calendar month;
(v) the aggregate amount of servicing compensation retained by or paid to
the Master Servicer and the Special Servicer in respect of the related
Collection Period;
(vi) the aggregate Stated Principal Balance of the Mortgage Pool
immediately before and after such Distribution Date and the percentage of the
Cut-off Date Principal Balance of the Mortgage Pool which remains outstanding
immediately after such Distribution Date;
(vii) the number, aggregate principal balance, weighted average remaining
term to maturity and weighted average Mortgage Rate of the outstanding Mortgage
Loans in the Mortgage Pool at the close of business on the related Determination
Date;
(viii) as of the end of the prior calendar month, the number and aggregate
unpaid principal balance of Mortgage Loans in the Mortgage Pool (A) delinquent
one month, (B) delinquent two months, (C) delinquent three or more months, (D)
that are Specially Serviced Mortgage Loans but are not delinquent or (E) as to
which foreclosure proceedings have been commenced;
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(ix) with respect to any Mortgage Loan as to which the related Mortgaged
Property became an REO Property during the related Collection Period, the Stated
Principal Balance and unpaid principal balance of such Mortgage Loan as of the
date such Mortgaged Property became an REO Property;
(x) as to any Mortgage Loan repurchased or otherwise liquidated or disposed
of during the related Collection Period, the loan number thereof and the amount
of any Liquidation Proceeds and/or other amounts, if any, received thereon
during the related Collection Period and the portion thereof included in the
Available Distribution Amount for such Distribution Date;
(xi) with respect to any REO Property included in the Trust Fund as of the
close of business on the last day of the related Collection Period, the loan
number of the related Mortgage Loan, the book value of such REO Property and the
amount of any 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 the portion thereof included in the Available
Distribution Amount for such Distribution Date;
(xii) with respect to any REO Property sold or otherwise disposed of during
the related Collection Period, the loan number of the related Mortgage Loan, and
the amount of Liquidation Proceeds and other amounts, if any, received in
respect of such REO Property during the related Collection Period and the
portion thereof included in the Available Distribution Amount for such
Distribution Date;
(xiii) the Distributable Certificate Interest in respect of each Class of
REMIC III Regular Certificates for such Distribution Date;
(xiv) any unpaid Distributable Certificate Interest in respect of each
Class of REMIC III Regular Certificates after giving effect to the distributions
made on such Distribution Date;
(xv) the Pass-Through Rate for each Class of REMIC III Regular Certificates
for such Distribution Date and the next Distribution Date;
(xvi) the Class Principal Balance or Class Notional Amount, as the case may
be, of each Class of REMIC III Regular Certificates immediately before and
immediately after such Distribution Date, separately identifying any reduction
in the Class Principal Balance or Class Notional Amount, as the case may be, of
each such Class due to Realized Losses and Additional Trust Fund Expenses;
(xvii) the Certificate Factor for each Class of REMIC III Regular
Certificates immediately following such Distribution Date;
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(xviii) the Principal Distribution Amount for such Distribution Date;
(xix) the aggregate amount of Principal Prepayments made during the related
Collection Period, and the aggregate amount of any Prepayment Interest Excesses
received and Prepayment Interest Shortfalls incurred in connection therewith;
(xx) the aggregate amount of Realized Losses and Additional Trust Fund
Expenses, if any, incurred with respect to the Trust Fund during the related
Collection Period;
(xxi) on a cumulative basis from the Cut-off Date, the number, aggregate
Stated Principal Balance immediately after such Distribution Date (in the case
of subclauses (A), (B) and (C)), aggregate Cut-off Date Balance (in the case of
subclauses (C) and (D)), weighted average extension period (except in the case
of subclause (B) and which shall be zero in the case of subclause (C)), and
weighted average anticipated extension period (in the case of subclause (B)) of
Mortgage Loans
(A) as to which the Maturity Dates have been extended;
(B) as to which the Maturity Dates are in the process of being extended;
(C) that have paid off and were never extended;
(D) as to which the Maturity Dates had previously been extended and have
paid off; and
(E) as to which the Maturity Dates had been previously extended and are in
the process of being further extended;
(xxii) any Appraisal Reduction Amounts on a loan-by-loan basis, and the
total Appraisal Reduction Amounts, as of the related Determination Date;
(xxiii) the aggregate amount of any Balloon Payment Interest Excesses and
Balloon Payment Interest Shortfalls; and
(xxiv) such additional information as contemplated by Exhibit G hereto.
In the case of information furnished pursuant to subclauses (i), (ii), (iii) and
(xvi) above, the amounts shall be expressed as a dollar amount in the aggregate
for all Certificates of each applicable Class and per single Certificate of a
specified minimum denomination. The form of any Distribution Date Statement may
change over time.
The Trustee shall make available to Certificateholders and other interested
parties certain information via electronic transmission as may be agreed upon by
the Depositor and the
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Trustee. In addition, the Trustee shall make available to each
Certificateholder, to each Certificate Owner that makes a written request
therefor and certifies as to its Ownership Interest in any Class of Book-Entry
Certificates, to each Underwriter and to the Rating Agencies, a report (based on
information received from the Master Servicer and in a format mutually
acceptable to the Trustee and the Master Servicer) containing, information
regarding the Mortgage Pool as of the close of business on the related
Determination Date, which report shall contain substantially the categories of
information regarding the Mortgage Loans set forth in Exhibit G hereto
(calculated, where applicable, on the basis of the most recent relevant
information provided by the Mortgagors to the Master Servicer or the Special
Servicer and by the Master Servicer or the Special Servicer, as the case may be,
to the Trustee) and such information shall be presented in a tabular format
substantially similar to the formats utilized in Exhibit G hereto. On each
Distribution Date, the Trustee shall make (x) certain information contained in
the Monthly Distribution Statement available through its ASAP System by
Certificateholders calling (312) 904-2200 and requesting statement No. 325 and
(y) certain information regarding the Mortgage Loans available in electronic
format through its dial up bulletin board service, by Certificateholders dialing
telephone number (714) 282-3990. Additionally, certain information regarding the
Mortgage Loans will be made accessible at the website maintained by LaSalle
National Bank at www.lnbabs.com.
Within a reasonable period of time after the end of each calendar year, the
Trustee shall furnish to each Person who at any time during the calendar year
was a Holder of a Certificate a statement containing the information as to the
applicable Class set forth in clauses (i), (ii) and (iii) of the description of
Distribution Date Statements above aggregated for such calendar year or
applicable portion thereof during which such person was a Certif- icateholder,
together with such other information as the Trustee determines to be necessary
to enable Certificateholders to prepare their tax returns for such calendar
year. Such obligation of the Trustee shall be deemed to have been satisfied to
the extent that substantially comparable information shall be provided by the
Trustee pursuant to any requirements of the Code as from time to time are in
force.
Upon filing with the Internal Revenue Service, the Trustee shall furnish to
the Holders of the Residual Certificates the Form 1066 and shall furnish their
respective Schedules Q thereto at the times required by the Code or the Internal
Revenue Service, and shall provide from time to time such information and
computations with respect to the entries on such forms as any Holder of the
Residual Certificates may reasonably request.
The specification of information to be furnished by the Trustee to the
Certificateholders in this Section 4.02 (and any other terms of this Agreement
requiring or calling for delivery or reporting of information by the Trustee to
Certificateholders and Certificate Owners) shall not limit the Trustee in
furnishing, and the Trustee is hereby authorized to furnish, to
Certificateholders, Certificate Owners and/or to the public any other
information (such other information, collectively, "Additional Information")
with respect to the Mortgage Loans, the Mortgaged Properties or the Trust Fund
as may be provided to it by the Depositor,
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the Master Servicer or the Special Servicer or gathered by it in any
investigation or other manner from time to time, provided that (A) while there
exists any Event of Default, any such Additional Information shall only be
furnished with the consent or at the request of the Depositor (except pursuant
to clause (E) below), (B) the Trustee shall be entitled to indicate the source
of all information furnished by it, and the Trustee may affix thereto any
disclaimer it deems appropriate in its sole discretion (together with any
warnings as to the confidential nature and/or the uses of such information as it
may, in its sole discretion, determine appropriate), (C) the Trustee may notify
Certificateholders and Certificate Owners of the availability of any such
information in any manner as it, in its sole discretion, may determine, (D) the
Trustee shall be entitled (but not obligated) to require payment from each
recipient of a reasonable fee for, and its out-of-pocket expenses incurred in
connection with, the collection, assembly, reproduction or delivery of any such
Additional Information, (E) without the consent of the Depositor, the Trustee
may, in its sole discretion, furnish Additional Information to a Rating Agency
in any instance, and to the Certificateholders, Certificate Owners and/or the
public-at-large if it determines that the furnishing of such information would
assist in the evaluation of the investment characteristics or valuation of the
Certificates or would be in the best interests of the Certificateholders or is
required by applicable law and (F) the Trustee shall be entitled to distribute
or make available such Additional Information in accordance with such reasonable
rules and procedures as it may deem necessary or appropriate (which may include
the requirement that an agreement that provides such information shall be used
solely for purposes of evaluating the investment characteristics or valuation of
the Certificates be executed by the recipient, if and to the extent the Trustee
deems the same to be necessary or appropriate). Nothing herein shall be
construed to impose upon the Trustee any obligation or duty to furnish or
distribute any Additional Information to any Person in any instance, and the
Trustee shall neither have any liability for furnishing nor for refraining from
furnishing Additional Information in any instance. The Trustee shall be entitled
(but not required) to request and receive direction from the Depositor as to the
manner of delivery of any such Additional Information, if and to the extent the
Trustee deems necessary or advisable, and to require that any consent, direction
or request given to it pursuant to this Section be made in writing.
Upon the authorization of the Depositor, the Trustee shall make available
to Bloomberg Financial Markets, L.P. ("Bloomberg") all the reports delivered or
made available pursuant to this Section 4.02(a) to the Certificateholders and
Certificate Owners using a format and media mutually acceptable to the Trustee
and Bloomberg.
(b) At or before 11:00 a.m. (New York City time) on the third Business Day
prior to each Distribution Date, subject to the last paragraph of this
subsection (b), the Master Servicer shall deliver or cause to be delivered to
the Trustee (and, if the Master Servicer is not the Special Servicer, the
Trustee shall deliver to the Special Servicer) in form mutually acceptable to
the Trustee and the Master Servicer the following reports or information: (1) a
Delinquent Loan Status Report, (2) an REO Status Report, (3) a Historical Loan
Modification Report, (4) a Historical Loss Report, (5) the Servicer Watch List
and (6) a single report (the "Collection Report") setting forth, among other
things, the information specified in clauses (i)
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through (vii) below (the amounts and allocations of payments, collections, fees
and expenses with respect to Specially Serviced Mortgage Loans and REO
Properties to be based upon the report to be delivered by the Special Servicer
to the Master Servicer on the second Business Day after the related
Determination Date, in the form required by Section 4.02(c) below):
(i) the aggregate amount that is to be transferred from the Certificate
Account to the Distribution Account in respect of such Distribution Date that is
allocable to principal on or in respect of the Mortgage Loans and any REO Loans,
separately identifying the aggregate amount of any Principal Prepayments
included therein, and (if different) the Principal Distribution Amount for the
immediately succeeding Distribution Date;
(ii) the aggregate amount that is to be transferred from the Certificate
Account to the Distribution Account in respect of such Distribution Date that is
allocable to (A) interest on or in respect of the Mortgage Loans and any REO
Loans and (B) Prepayment Premiums;
(iii) the aggregate amount of any Delinquency Advances (specifying the
principal and interest portions thereof separately) to made pursuant to Section
4.03 of this Agreement as of the end of the prior calendar month that were
included in amounts deposited in the Distribution Account;
(iv) the information required to be included in the Distribution Date
Statement for the next succeeding Distribution Date and described in clauses (v)
- - (xii) and (xvii) - (xxii) of the description of the Distribution Date
Statement in Section 4.02(a);
(v) the loan number and the unpaid principal balance as of the close of
business on such Determination Date of each Specially Serviced Mortgage Loan and
each other Defaulted Mortgage Loan;
(vi) such other information on a Mortgage Loan-by-Mortgage Loan or REO
Property-by-REO Property basis as the Trustee or the Depositor shall reasonably
request in writing (including, without limitation, information with respect to
any modifications of any Mortgage Loan, any Mortgage Loans in default or
foreclosure, the operation and disposition of REO Property and the assumption of
any Mortgage Loan); and
(vii) such additional information as is contemplated by the Master Servicer
Remittance Report.
On the date on which the report described above is delivered to the
Trustee, the Master Servicer shall also deliver or cause to be delivered to the
Trustee a report, in form reasonably acceptable to the Trustee, containing the
information with respect to the Mortgage Pool necessary for the Trustee to
prepare with respect to the Mortgage Pool any additional schedules and tables
required to be made available by the Trustee pursuant to Section 4.02(a),
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as well as to prepare an updated Mortgage Loan Schedule, in each case reflecting
the changes in the Mortgage Pool during the related Collection Period.
Prior to each Distribution Date, the Master Servicer will deliver to the
Trustee (by electronic means) a "Comparative Financial Status Report" containing
substantially the content set forth in Exhibit I setting forth, among other
things, the occupancy, revenue, net operating income and debt service coverage
ratio for each Mortgage Loan or related Mortgaged Property as of the
Determination Date immediately preceding the preparation of such report for each
of the following three periods (but only to the extent the related borrower is
required by the Mortgage to deliver and does deliver, or otherwise agrees to
provide and does provide, such information): (i) the most current available
year-to-date; (ii) each of the previous two full fiscal years stated separately
(to the extent such information is in the Master Servicer's possession; and
(iii) the "base year" (representing the original analysis of information used as
of the Cut-Off Date).
In addition, the Master Servicer is also required to perform with respect
to each Mortgaged Property and REO Property:
(i) Within 30 days after receipt of a quarterly operating statement,
if any, commencing with the calendar quarter ended June 30, 1998, an
"Operating Statement Analysis" containing revenue, expense, and net
operating income information substantially in accordance with Exhibit I
presenting the computation made in accordance with the methodology set
forth in Exhibit F (but only to the extent the related borrower is required
by the Mortgage to deliver and does deliver, or otherwise agrees to provide
and does provide, such information) for such Mortgaged Property or REO
Property as of the end of such calendar quarter. The Master Servicer will
deliver to the Trustee by electronic means the Operating Statement Analysis
upon request; and
(ii) Within 30 days after receipt by the Master Servicer of an annual
operating statement, an NOI adjustment analysis containing substantially
the content set forth in Exhibit I, the "NOI Adjustment Worksheet" (but
only to the extent the related borrower is required by the Mortgage to
deliver and does deliver, or otherwise agrees to provide and does provide,
such information), presenting the computation made in accordance with the
methodology described in Exhibit F to "normalize" the full year net
operating income and debt service coverage numbers used by the Master
Servicer in its reporting obligation in (1) above. The Master Servicer will
deliver to the Trustee by electronic means the "NOI Adjustment Worksheet"
upon request.
Upon request, the Trustee shall deliver or shall cause to be delivered to each
Certificateholder, to any Underwriter, to the Rating Agencies, and to each
Certificate Owner that makes a written request therefor and certifies as to its
Ownership Interest in any Class of Book-Entry Certificates a copy of the
Operating Statement Analysis and NOI Adjustment Worksheet most recently
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performed by the Master Servicer with respect to any Mortgage Loan and delivered
to the Trustee.
Not later than the first day of the calendar month following each Master
Servicer Remittance Date, the Master Servicer shall forward to the Trustee a
statement, setting forth the status of the Certificate Account as of the close
of business on such Master Servicer Remittance Date, stating that all
remittances to the Trustee required by this Agreement to be made by the Master
Servicer have been made (or, in the case of any such required remittance that
has not been made by the Master Servicer, specifying the nature and status
thereof) and showing, for the period from the preceding Master Servicer
Remittance Date (or, in the case of the first Master Servicer Remittance Date,
from the Cut-off Date) to such Master Servicer Remittance Date, the aggregate of
deposits into and withdrawals from the Certificate Account for each category of
deposit specified in Section 3.04(a) and each category of withdrawal specified
in Section 3.05(a). The Master Servicer shall also deliver to the Trustee, upon
reasonable request of the Trustee, any and all additional information relating
to the Mortgage Pool in the possession of the Master Servicer (which information
shall be based upon reports delivered to the Master Servicer by the Special
Servicer with respect to Specially Serviced Mortgage Loans and REO Properties).
The Master Servicer, on the first Business Day following each Determination
Date, shall forward to the Special Servicer all information collected by the
Master Servicer which the Special Servicer is required to include in the reports
delivered by the Special Servicer pursuant to Section 4.02(c) below. Further,
the Master Servicer shall cooperate with the Special Servicer and provide the
Special Servicer with the information in the possession of the Master Servicer
reasonably requested by the Special Servicer, in writing, to the extent required
to allow the Special Servicer to perform its obligations under this Agreement
with respect to those Mortgage Loans serviced by the Master Servicer.
The obligation of the Master Servicer to deliver the reports required to be
delivered by it pursuant to this subsection (b) is subject to the Master
Servicer having received from the Special Servicer in a timely manner the
related reports and information necessary or required to enable the Master
Servicer to prepare and deliver such reports. The Master Servicer shall not be
responsible for the accuracy or content of any report, document or information
furnished by the Special Servicer to the Master Servicer pursuant to this
Agreement and accepted by the Master Servicer in good faith pursuant to this
Agreement.
(c) On the second Business Day after each Determination Date, the Special
Servicer shall forward to the Master Servicer, for each Specially Serviced
Mortgage Loan and REO Property, reports containing all information the Master
Servicer will be required to include in the other reports that the Master
Servicer is obligated to deliver to the Trustee pursuant to Section 4.02(b), to
the extent such information relates to any Specially Serviced Mortgage Loan or
any REO Property. The Special Servicer shall also deliver to the Trustee, upon
the reasonable written request of the Trustee, any and all additional
information in the possession
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of the Special Servicer relating to the Specially Serviced Mortgage Loans and
the REO Properties.
The Special Servicer shall cooperate with the Master Servicer and provide
the Master Servicer with the information in the possession of the Special
Servicer reasonably requested by the Master Servicer, in writing, to the extent
required to allow the Master Servicer to perform its obligations under this
Agreement with respect to the Specially Serviced Mortgage Loans and REO
Properties. Additional information regarding the Specially Serviced Mortgage
Loans and REO Properties, including, without limitation, any financial or
occupancy information (including lease summaries) provided to the Special
Servicer by the Mortgagors or otherwise obtained, shall be delivered to the
Master Servicer, within ten days of receipt.
SECTION 4.03 Delinquency Advances.
(a) On each Delinquency Advance Date, the Master Servicer shall either (i)
deposit into the Certificate Account from its own funds an amount equal to the
aggregate amount of Delinquency Advances, if any, to be made in respect of the
related Distribution Date, (ii) apply amounts held in the Certificate Account
for future distribution to Certificateholders in subsequent months in discharge
of any such obligation to make Delinquency Advances, or (iii) make Delinquency
Advances in the form of any combination of (i) and (ii) aggregating the total
amount of Delinquency Advances to be made; provided that, if Late Collections
(net of related Workout Fees) of the delinquent Monthly Payments for which
Delinquency Advances are to be made for the related Distribution Date, are on
deposit in the Certificate Account and available to make such Advances, the
Master Servicer shall utilize such Late Collections to make such Advances
pursuant to clause (ii) above. Any amounts held in the Certificate Account for
future distribution and so used to make Delinquency 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 Delinquency Advances were made). If, as of 3:00 p.m., New York
City time, on any Master Servicer Remittance Date, the Trustee shall not have
received any Delinquency Advance required to be made by the Master Servicer
pursuant to this Section 4.03(a) (and the Master Servicer shall not have
delivered to the Trustee the requisite Officer's Certificate and documentation
related to a determination of nonrecoverability of a Delinquency Advance), then
the Trustee shall provide notice of such failure to a Servicing Officer of the
Master Servicer by facsimile transmission sent to telecopy no. (215) 328-3478
(or such alternative number provided by the Master Servicer to the Trustee in
writing) and by telephone at telephone no. (215) 328-1790 (Attention: Master
Servicing Manager) (or such alternative number provided by the Master Servicer
to the Trustee in writing) as soon as possible, but in any event before 5:00
p.m., New York City time, on such day. If after such notice the Trustee does not
receive the full amount of such Delinquency Advances by 11:00 a.m., New York
City time, on the Business Day immediately following such Master Servicer
Remittance Date, then the Trustee shall make the portion of such Delinquency
Advances that was required to be, but
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was not, made by the Master Servicer pursuant to this Section 4.03(a). If the
Trustee fails to make a Delinquency Advance required to be made by it hereunder,
the Fiscal Agent shall make such advance no later than 1:00 p.m. New York City
time on the Business Day immediately following such Master Servicer Remittance
Date. The making of such advance by the Fiscal Agent shall cure the failure by
the Trustee to make such advance.
(b) The aggregate amount of Delinquency Advances to be made by the Master
Servicer in respect of the Mortgage Loans (including, without limitation,
Assumed Monthly Payments for Balloon Mortgage Loans delinquent as to their
respective Balloon Payments) and any REO Loans for any Distribution Date shall
equal, subject to subsection (c) below, the aggregate of all Monthly Payments
(other than Balloon Payments) and any Assumed Monthly Payments, in each case net
of related Workout Fees payable hereunder, that were due or deemed due, as the
case may be, in respect thereof on their respective Due Dates during the related
Collection Period and that were not paid by or on behalf of the related
Mortgagors or otherwise collected as of the close of business on the last day of
the related Collection Period; provided that, if an Appraisal Reduction Amount
exists with respect to any Required Appraisal Loan, then, in the event of
subsequent delinquencies thereon, the interest portion of the Delinquency
Advance in respect of such Required Appraisal Loan for the related Distribution
Date shall be reduced (it being herein acknowledged that there shall be no
reduction in the principal portion of such Delinquency Advance) to equal the
product of (i) the amount of the interest portion of such Delinquency Advance
for such Required Appraisal Loan for such Distribution Date without regard to
this proviso, multiplied by (ii) a fraction, expressed as a percentage, the
numerator of which is equal to the Stated Principal Balance of such Required
Appraisal Loan immediately prior to such Distribution Date, net of the related
Appraisal Reduction Amount, if any, and the denominator of which is equal to the
Stated Principal Balance of such Required Appraisal Loan immediately prior to
such Distribution Date.
(c) Notwithstanding anything herein to the contrary, no Delinquency Advance
shall be required to be made hereunder if such Delinquency Advance would, if
made, constitute a Nonrecoverable Delinquency Advance. In addition,
Nonrecoverable Delinquency Advances shall be reimbursable pursuant to Section
3.05(a) out of general collections on the Mortgage Loans and REO Properties on
deposit in the Certificate Account. The determination by the Master Servicer or,
if applicable, the Trustee or the Fiscal Agent, that it has made a
Nonrecoverable Delinquency Advance or that any proposed Delinquency Advance, if
made, would constitute a Nonrecoverable Delinquency Advance, shall be evidenced
by an Officer's Certificate delivered promptly (and, in any event, in the case
of a proposed Delinquency Advance to be made by the Master Servicer, no less
than two Business Days prior to the related Delinquency Advance Date) by the
Master Servicer to the Trustee (or, if applicable, retained thereby) and the
Depositor, setting forth the basis for such determination, together with (if
such determination is prior to the liquidation of the related Mortgage Loan or
REO Property) a copy of an Appraisal of the related Mortgaged Property or REO
Property, as the case may be, which shall have been performed within the twelve
months preceding such determination, and further accompanied by any other
information that the Master Servicer or the Special Servicer may have
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obtained and that supports such determination. If such an Appraisal shall not
have been required and performed pursuant to the terms of this Agreement, the
Master Servicer, the Special Servicer, the Trustee or the Fiscal Agent, as the
case may be, may, subject to its reasonable and good faith determination that
such Appraisal will demonstrate the nonrecoverability of the related Advance,
obtain an Appraisal for such purpose at the expense of the Trust Fund. The
Trustee and the Fiscal Agent shall be entitled to rely on any determination of
nonrecoverability that may have been made by the Master Servicer or the Special
Servicer with respect to a particular Delinquency Advance, and the Master
Servicer shall be entitled to rely on any determination of nonrecoverability
that may have been made by the Special Servicer with respect to a particular
Delinquency Advance.
(d) The Master Servicer, the Trustee and the Fiscal Agent shall each be
entitled to receive interest at the Reimbursement Rate in effect from time to
time, accrued on the amount of each Delinquency Advance made thereby (out of its
own funds) for so long as such Delinquency Advance is outstanding (or, if any
Delinquency Advance is required to be made in respect of a delinquent Monthly
Payment on any Mortgage Loan prior to the end of the grace period for such
Monthly Payment, for so long as such Delinquency Advance is outstanding
following the end of such grace period), payable first, out of Penalty Charges
received on the Mortgage Loan or REO Loan as to which such Delinquency Advance
was made and, then, once such Delinquency Advance has been reimbursed, out of
general collections on the Mortgage Loans and REO Properties.
SECTION 4.04 Allocation of Realized Losses and Additional Trust Fund
Expenses.
(a) On each Distribution Date, following the deemed distributions to be
made in respect of the REMIC I Regular Interests pursuant to Section 4.01(a),
the Uncertificated 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, or if
applicable, a Replacement Mortgage 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.
(b) On each Distribution Date, following the payments deemed to be made to
REMIC III in respect of the REMIC II Regular Interests on such date pursuant to
Section 4.01(b), the Trustee shall determine the amount, if any, by which (i)
the then aggregate Uncertificated Principal Balance of REMIC II Regular
Interests LA-1, LA-2, LB, LC, LD, LE, LF, LG, LH, LJ, LK, LL, LM and LN exceeds
(ii) an amount equal to the aggregate Stated Principal Balance of the Mortgage
Pool that will be outstanding immediately following such Distribution Date. If
such excess does exist, then the respective Uncertificated Principal Balances of
such REMIC II Regular Interests shall be reduced such that the Uncertificated
Principal Balance of each REMIC II Regular Interest corresponds with the
Certificate Principal
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Balance of the corresponding Class of Certificates outstanding after the
subsequent adjustments made on such Distribution Date under Section 4.04(c)
below.
(c) On each Distribution Date, following the distributions to be made to
the Certificateholders on such date pursuant to Section 4.01(c), the Trustee
shall determine the amount, if any, by which (i) the then aggregate Certificate
Principal Balance of the Principal Balance Certificates, exceeds (ii) the
aggregate Stated Principal Balance of the Mortgage Pool that will be outstanding
immediately following such Distribution Date. If such excess does exist, then
the Class Principal Balances of the Class N, Class M, Class L, Class K, Class J,
Class H, Class G, Class F, Class E, Class D, Class C and Class B Certificates
shall be reduced sequentially, in that order, in each case, until the first to
occur of such excess being reduced to zero or the related Class Principal
Balance being reduced to zero. If, after the foregoing reductions, the amount
described in clause (i) of the second preceding sentence still exceeds the
amount described in clause (ii) of the second preceding sentence, then the
respective Class Principal Balances of the Class A-1 and Class A-2 Certificates
shall be reduced, pro rata in accordance with the relative sizes of the then
outstanding Class Principal Balances of such Classes of Certificates, until the
first to occur of such excess being reduced to zero or each such Class Principal
Balance being reduced to zero. Such reductions in the Class Principal Balances
of the respective Classes of Principal Certificates shall be deemed to be
allocations of Realized Losses and Additional Trust Fund Expenses.
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ARTICLE V
THE CERTIFICATES
SECTION 5.01 The Certificates.
(a) The Certificates will be substantially in the respective forms annexed
hereto as Exhibits A-1 through A-16. The Certificates will be issuable in
registered form only; provided, however, that in accordance with Section 5.03
beneficial ownership interests in the Registered Certificates shall initially be
held and transferred through the book-entry facilities of the Depository. The
REMIC III Regular Certificates will be issuable in denominations corresponding
to initial Certificate Principal Balances or Certificate Notional Amounts, as
the case may be, as of the Closing Date of not less than $25,000 in the case of
the Class A-1, Class A-2, Class B, Class C, Class D, Class E and Class F
Certificates, $100,000 in the case of the Class G, Class H, Class J, Class K,
Class L, Class M and Class N Certificates, and $1,000,000 in the case of the
Class X Certificates, and in each such case in any whole dollar denomination in
excess thereof; provided, however, that a single Certificate of each Class
thereof may be issued in a different denomination. The Residual Certificates
will be issuable only in denominations representing Percentage Interests of not
less than 20% in the related Class.
(b) The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee in its capacity as trustee hereunder by an authorized
officer. Certificates bearing the manual or facsimile signatures of individuals
who were at any time the authorized officers of the Trustee 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
Certificate Registrar by manual signature, and such certificate of
authentication upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication.
SECTION 5.02 Registration of Transfer and Exchange of Certificates.
(a) At all times during the term of this Agreement, there shall be
maintained at the office of the Certificate Registrar a Certificate Register in
which, subject to such reasonable regulations as the Certificate Registrar may
prescribe, the Certificate Registrar shall provide for the registration of
Certificates and of transfers and exchanges of Certificates as herein provided.
The Trustee is hereby initially appointed (and hereby agrees to act in
accordance with the terms hereof) as Certificate Registrar for the purpose of
registering
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Certificates and transfers and exchanges of Certificates as herein provided. The
Certificate Registrar may appoint, by a written instrument delivered to the
Depositor, the Master Servicer and the Special 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 predecessor's duties as Certificate Registrar. The Depositor, 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.
(b) (i) No transfer of any Non-Registered Certificate shall be made unless
such 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 a transfer by the Depositor or
an Affiliate thereof, then the Trustee shall require, in order to assure
compliance with such laws, receipt by it and the Depositor of:
(A) if such transfer is purportedly being made in reliance upon Rule 144A
under the Securities Act, a certificate from the Certificateholder desiring
to effect such transfer substantially in the form attached as Exhibit B-1
hereto and a certificate from such Certificateholder's prospective
transferee substantially in the form attached as Exhibit B-2 hereto; and
(B) in all other cases, (1) a certificate from the Certificateholder
desiring to effect such transfer substantially in the form attached hereto
as Exhibit B-1 and a certificate from such Certificateholder's prospective
transferee substantially in the form attached hereto as Exhibit B-3, and
(2) unless the Depositor directs otherwise, an Opinion of Counsel
satisfactory to the Trustee and the Depositor to the effect that such
transfer may be made without such registration (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).
(ii) Notwithstanding the foregoing, transfers of a beneficial interest in
any Class (or portion thereof) of Private Book-Entry Certificates in accordance
with the rules and procedures of the Depository applicable to transfers by its
respective participants will be permitted if such transfer is made in accordance
with Rule 144A promulgated under the Securities Act. Any transfer of a
beneficial interest in any Class (or portion thereof) of Private Book-Entry
Certificates other than pursuant to Rule 144A, or to a transferee that wishes to
take delivery of such interest in definitive form, will be permitted upon:
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(A) receipt by the Trustee and the Depositor of the documentation required
by Section 5.02(b)(i)(A) or (B);
(B) the execution by the Trustee, and the authentication and delivery by
the Certificate Registrar to the transferee, of a Definitive Certificate
representing such beneficial interest; and
(C) to the extent that the beneficial interest being transferred does not
represent the entire Certificate Principal Balance of the related Class,
either (1) the execution by the Trustee, and the authentication and
delivery by the Certificate Registrar to the Depository (upon surrender by
the Depository of the prior Book-Entry Certificate) of, a new Private Book-
Entry Certificate representing the remaining beneficial interest of such
Class of Private Book-Entry Certificates or (2) the appropriate notation by
the Trustee on the Private Book-Entry Certificate or otherwise in its books
and records as custodian for the Depository evidencing the date of such
exchange or transfer and a decrease in the denomination of such Private
Book-Entry Certificate equal to the denomination of the Definitive
Certificate issued in exchange therefor or upon transfer thereof.
(iii) None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify any Class of Non-Registered Certificates under
the Securities Act or any other securities law or to take any action not
otherwise required under this Agreement to permit the transfer of any
Non-Registered Certificate without registration or qualification. Any Holder of
a Non-Registered Certificate desiring to effect such a transfer shall, and does
hereby agree to, indemnify the Depositor, the Trustee and the Certificate
Registrar against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.
(c) (i) No transfer of a Senior 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 Section 4975 of the
Code (each, a "Plan"), or (B) to any Person who is directly or indirectly
purchasing such Certificate or interest therein on behalf of, as named fiduciary
of, as trustee of, or with assets of a Plan, unless: (1) such Plan qualifies for
the exemptive relief available under the terms of Prohibited Transaction
Exemption 94-29 (granted to certain affiliates of the Depositor) and (2) at the
time of such transfer, the Senior Certificates continue to be rated in one of
the top three rating categories by at least one Rating Agency.
(ii) 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 Section 4975 of the
Code (each, a "Plan"), or (B) to any Person who is directly or indirectly
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purchasing such Certificate or interest therein on behalf of, as named fiduciary
of, as trustee of, or with assets of a Plan, unless the prospective transferee
provides the Depositor, the Trustee and the Master Servicer with an opinion of
counsel satisfactory to the Depositor, the Trustee and the Master Servicer that
such transfer is permissible under applicable law, will not constitute or result
in any non-exempt prohibited transaction under ERISA or Section 4975 of the Code
and will not subject the Depositor, the Trustee or the Master Servicer to any
obligation in addition to those undertaken herein. In lieu of such opinion of
counsel, the prospective transferee of a Subordinated Certificate may provide a
certification of facts substantially to the effect that the purchase of such
Certificate by or on behalf of, or with assets of, any Plan is permissible under
applicable law, will not constitute or result in any non-exempt prohibited
transaction under ERISA or Section 4975 of the Code, will not subject the
Depositor, the Trustee or the Master Servicer to any obligation in addition to
those undertaken herein, and the following conditions are met: (a) the source of
funds used to purchase such Certificate is an "insurance company general
account" (as such term is defined in United States Department of Labor
Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) and (b) the
conditions set forth in Sections I and III of PTCE 95-60 have been satisfied as
of the date of the acquisition of such Certificates. In addition, so long as any
portion of the Class B, Class C, Class D, Class E, Class F, Class G and Class H
Certificates are Book-Entry Certificates, any purchaser of such Certificates
will be deemed to have represented by such purchase that either (a) such
purchaser is not a Plan and is not purchasing such Certificates by or on behalf
of, or with "plan assets" of, any Plan or (b) the purchase of any such
Certificate by or on behalf of, or with "plan assets" of, any Plan is
permissible under applicable law, will not result in any non-exempt prohibited
transaction under ERISA or Section 4975 of the Code, and will not subject the
Depositor, the Trustee or the Master Servicer to any obligation in addition to
those undertaken herein, and the following conditions are met: (a) the source of
funds used to purchase such Certificate is an "insurance company general
account" (as such term is defined in PTCE 95-60) and (b) the conditions set
forth in Sections I and III of PTCE 95-60 have been satisfied as of the date of
the acquisition of such Certificates. The Trustee may require that any
prospective transferee of a Subordinated Certificate that is held as a
Definitive Certificate, provide such certifications as the Trustee may deem
desirable or necessary in order to establish that such transferee or the Person
in whose name such registration is requested is not a Plan or a Person who is
directly or indirectly purchasing such Certificate on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan. The Trustee shall not
have any responsibility to monitor or restrict the transfer of Ownership
Interests in any Subordinated Certificates that are in the form of a Book-Entry
Certificate.
(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 Trustee under clause (ii)(A) below to deliver
payments to a Person other than such Person and to have irrevocably authorized
the Trustee under clause (ii)(B) below to negotiate the terms of any mandatory
sale and to execute all instruments of Transfer and to do all other things
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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 a United States
Person and shall promptly notify the Trustee 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 Trustee shall require delivery to it, and no
Transfer of any Residual Certificate shall be registered until the Trustee
receives, an affidavit and agreement substantially in the form attached
hereto as Exhibit C-1 (a "Transfer Affidavit and Agreement") from the
proposed Transferee, in form and substance satisfactory to the Trustee,
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,
that it is a United States Person, and that it has reviewed the provisions
of this Section 5.02(d) and agrees to be bound by them.
(C) Notwithstanding the delivery of a Transfer Affidavit and Agreement
by a proposed Transferee under clause (B) above, if the Trustee has actual
knowledge that the proposed Transferee is not a Permitted Transferee or is
not a United States Person, 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 Trustee a certificate substantially in the form attached
hereto as Exhibit C-2 stating that, among other things, it has no actual
knowledge that such prospective Transferee is not a Permitted Transferee or
is not a United States Person.
(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 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
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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) or if any
Holder of a Residual Certificate shall lose its status as a Permitted Transferee
or a United States Person, 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, the Special
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), or if
any Holder of a Residual Certificate shall lose its status as a Permitted
Transferee or a United States Person, and to the extent that the
retroactive restoration of the rights of the prior Holder of such Residual
Certificate as described in clause (ii)(A) above shall be invalid, illegal
or unenforceable, then the Trustee shall have the right, without notice to
the Holder or any prior Holder of such Residual Certificate, to sell such
Residual Certificate to a purchaser selected by the Trustee on such terms
as the Trustee may choose. Such non-complying Holder shall promptly endorse
and deliver such Residual Certificate in accordance with the instructions
of the Trustee. Such purchaser may be the Trustee itself or any Affiliate
of the Trustee. The proceeds of such sale, net of the commissions (which
may include commissions payable to the Trustee or its Affiliates), expenses
and taxes due, if any, will be remitted by the Trustee to such noncomplying
Holder. The terms and conditions of any sale under this clause (ii)(B)
shall be determined in the sole discretion of the Trustee, and the Trustee
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 Trustee shall make available to the Internal Revenue Service and
those Persons specified by the REMIC Provisions, all information 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 not a Permitted Transferee,
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 not a Permitted Transferee. The
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Person holding such Ownership Interest shall be responsible for the reasonable
compensation of the Trustee for providing such information.
(iv) The provisions of this Section 5.02(d) set forth prior to this
subsection (iv) may be modified, added to or eliminated, provided that there
shall have been delivered to the Trustee and the Depositor the following:
(A) written notification 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
Trustee and the Depositor, to the effect that such modification of,
addition to or elimination of such provisions will not cause any of REMIC
I, REMIC II or REMIC III to (x) cease to qualify as a REMIC or (y) be
subject to an entity-level tax caused by the Transfer of any Residual
Certificate to a Person which is not a Permitted Transferee, or cause a
Person other than the prospective Transferee to be subject to a REMIC-
related tax caused by the Transfer of a Residual Certificate to a Person
which is not a Permitted Transferee.
(e) Subject to the preceding subsections, upon surrender for registration
of transfer of any Certificate at the offices of the Certificate Registrar
maintained for such purpose, the Trustee shall execute and the Certificate
Registrar 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 Trustee
shall execute and the Certificate Registrar 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 Trustee or the Certificate Registrar) be duly
endorsed by, or be accompanied by a written instrument of transfer in the form
satisfactory to the Trustee and 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 Trustee or the Certificate Registrar may require payment
of a sum sufficient
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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 hold such canceled Certificates in accordance with its standard
procedures.
(j) The Certificate Registrar shall be required to provide notice to the
Master Servicer, the Special Servicer and the Depositor of each transfer of a
Certificate and to provide each such Person with an updated copy of the
Certificate Register on or about January 1 and July 1 of each year, commencing
July 1, 1998.
SECTION 5.03 Book-Entry Certificates.
(a) Each class of Registered Certificates and the Private Book-Entry
Certificates shall initially be issued as one or more Certificates registered in
the name of the Depository or its nominee and, except as provided in subsection
(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 subsection
(c) below (and, with respect to the Private Book-Entry Certificates, except as
provided in Section 5.02(b)(ii)), shall not be entitled to definitive, fully
registered Certificates ("Definitive Certificates") in respect of such Ownership
Interests. The Trustee shall not have any responsibility to monitor or restrict
the transfer of Ownership Interests in any Book-Entry Certificate. 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 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
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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 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, the Trustee shall notify all Certificate Owners, through the
Depository, of the occurrence of any such event and of the availability of
Definitive Certificates to Certificate Owners requesting the same. Upon
surrender to the Certificate Registrar of the Book-Entry Certificates by the
Depository, accompanied by registration instructions from the Depository for
registration of transfer and any other documents necessary to satisfy the
requirements of any applicable transfer restrictions, the Trustee shall execute,
and the Certificate Registrar shall authenticate and deliver, the applicable
Definitive Certificates to the Certificate Owners identified in such
instructions. None of the Depositor, the Master Servicer, the Special Servicer,
the Trustee, the Fiscal Agent or the Certificate Registrar shall be liable for
any delay in delivery of such instructions, and each may conclusively rely on,
and shall be protected in relying on, such instructions. Upon the issuance of
Definitive Certificates for purposes of evidencing ownership of the Registered
Certificates held in book-entry form, the registered holders of such Definitive
Certificates shall be recognized as Certificateholders hereunder and,
accordingly, shall be entitled directly to receive payments on, to exercise
Voting Rights with respect to, and to transfer and exchange such Definitive
Certificates.
SECTION 5.04 Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate, and (ii) there is delivered
to the Trustee and the Certificate Registrar such security or indemnity as may
be required by them to save each of them harmless, then, in the absence of
actual notice to the Trustee or the Certificate Registrar that such Certificate
has been acquired by a bona fide purchaser, the Trustee shall execute, and the
Certificate Registrar 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, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
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SECTION 5.05 Persons Deemed Owners.
Prior to due presentation of a Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the person in whose name such 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, except as and to the extent provided in
the definition of "Certificateholder", 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 except as
provided in Section 5.02(d).
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ARTICLE VI
THE DEPOSITOR, THE MASTER SERVICER AND THE SPECIAL SERVICER
SECTION 6.01 Liability of the Depositor, the Master Servicer and the
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 the Depositor, the
Master Servicer and the Special Servicer; Assignment of
Rights and Delegation of Duties by the Master Servicer and
the Special Servicer.
(a) Subject to subsection (b) below, the Depositor, the Master Servicer and
the Special Servicer each will keep in full effect its existence, rights and
franchises as a corporation under the laws of the jurisdiction of its
incorporation, and each will obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.
(b) The Depositor, the Master Servicer and the Special Servicer may be
merged or consolidated with or into any Person, or transfer all or substantially
all of its assets to any Person, in which case any Person resulting from any
merger or consolidation to which the Depositor, the Master Servicer or the
Special Servicer shall be a party, or any Person succeeding to the business of
the Depositor, the Master Servicer and the Special Servicer, shall be the
successor of the Depositor, the Master Servicer and 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 that such merger, consolidation or succession
will not result in the downgrade, qualification or withdrawal of the
then-current ratings of the Classes of Certificates that have been so rated (as
evidenced by a letter to such effect from each Rating Agency).
(c) Notwithstanding anything else in this Section 6.02 and Section 6.04 to
the contrary, the Master Servicer and the Special Servicer may assign all of its
rights and delegate all of its duties and obligations under this Agreement;
provided that the Person accepting such assignment or delegation shall be a
Person that is qualified to service multifamily mortgage loans on behalf of FNMA
or FHLMC, is reasonably satisfactory to the Trustee and the Depositor, is
willing to service the Mortgage Loans and executes and delivers to the Depositor
and the Trustee
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an agreement, in form and substance reasonably satisfactory to the Depositor and
the Trustee, which contains an assumption by such Person of the due and punctual
performance and observance of each covenant and condition to be performed or
observed by the Master Servicer or the Special Servicer, as the case may be,
under this Agreement; provided further that such assignment or delegation will
not result in the downgrade, qualification or withdrawal of the then-current
ratings of the Classes of Certificates that have been rated (as evidenced by a
letter to such effect from each Rating Agency). In the case of any such
assignment and delegation, the Master Servicer or the Special Servicer, as the
case may be, shall be released from its obligations under this Agreement, except
that the Master Servicer or the Special Servicer, as the case may be, shall
remain liable for all liabilities and obligations incurred by it, or arising
from its conduct, hereunder prior to the satisfaction of the conditions to such
assignment and delegation set forth in the preceding sentence. Notwithstanding
anything above to the contrary, each of the Master Servicer and the Special
Servicer may, in its sole discretion, appoint Sub- Servicers in accordance with
Section 3.22 hereof and independent contractors or agents to perform select
duties thereof, provided that the Master Servicer or the Special Servicer shall
not be relieved from such duties solely by virtue of such appointment.
SECTION 6.03 Limitation on Liability of the Depositor, the Master
Servicer, the Special Servicer and Others.
None of the Depositor, the Master Servicer, the Special Servicer or any of
the directors, officers, employees or agents of the Depositor, the Master
Servicer or the Special Servicer shall be under any liability to the Trust Fund
or the Certificateholders for any action taken or for refraining from the taking
of any action in good faith pursuant to this Agreement or for errors in
judgment; provided, however, that this provision shall not protect the
Depositor, the Master Servicer, the Special Servicer or any such Person against
any breach of warranties or representations made herein or 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 and 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 prima facie properly executed and submitted by any Person
respecting any matters arising hereunder. The Depositor, the Master Servicer and
the Special Servicer and any director, officer, employee or agent of the
Depositor, the Master Servicer or the Special Servicer shall be indemnified by
the Trust Fund and held harmless against any loss, liability or expense incurred
in connection with any legal action relating to this Agreement or the
Certificates or any asset of the Trust Fund, other than any loss, liability or
expense specifically required to be borne by such Person pursuant to the terms
hereof, or which constitutes a Servicing Advance (and is otherwise specifically
reimbursable hereunder), or which is incurred by such Person by reason of such
Person's willful misfeasance, bad faith or negligence in the performance of such
Person's duties hereunder or by reason of such Person's reckless disregard of
obligations and duties hereunder.
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None of the Depositor, the Master Servicer or the Special Servicer shall be
under any obligation to appear in, prosecute or defend any legal or
administrative action, proceeding, hearing or examination that is not incidental
to its respective duties under this Agreement and which in its opinion may
involve it in any expense or liability; provided, however, that the Depositor,
the Master Servicer or the Special Servicer may in its discretion undertake any
such action, proceeding, hearing or examination that it may deem necessary or
desirable in respect to this Agreement and the rights and duties of the parties
hereto and the interests of the Certificateholders hereunder. In such event, the
legal expenses and costs of such action, proceeding, hearing or examination 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 out of amounts attributable to the
Mortgage Loans on deposit in the Certificate Account as provided by Section
3.05(a).
SECTION 6.04 Depositor, Master Servicer and Special Servicer Not to
Resign.
Subject to the provisions of Section 6.02, none of the Depositor, the
Master Servicer or the Special Servicer shall resign from its respective
obligations and duties hereby imposed on it except upon determination that its
duties hereunder are no longer permissible under applicable law. Any such
determination permitting the resignation of the Depositor, the Master Servicer
or the Special Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee. No such resignation by the Master Servicer or
the Special Servicer shall become effective until the Trustee or a successor
servicer shall have assumed the responsibilities and obligations of the Master
Servicer or the Special Servicer, as the case may be, in accordance with Section
7.02.
SECTION 6.05 Rights of the Depositor in Respect of the Master Servicer
and the Special Servicer.
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 the Special Servicer hereunder or exercise the rights of the
Master Servicer or 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. 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.
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ARTICLE VII
DEFAULT
SECTION 7.01 Events of Default.
(a) "Event of Default", wherever used herein, means any one of the
following events:
(i) (A) any failure by the Master Servicer to make a required deposit
to the Certificate Account which continues unremedied for one Business Day
following the date on which such deposit was first required to be made, or
(B) any failure by the Master Servicer to deposit into, or to remit to the
Trustee for deposit into, the Distribution Account any amount required to
be so deposited or remitted, which failure is not remedied by 11:00 a.m.
(New York City time) on the relevant Distribution Date; provided, however,
that the Master Servicer will pay the Trustee interest on such late payment
at the prime rate until such late payment is received by the Trustee; or
(ii) any failure by the Special Servicer 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 which failure
continues unremedied for one Business Day following the date on which such
deposit or remittance was first required to be made; or
(iii) any failure by the Master Servicer or the Special Servicer to
timely make any Servicing Advance required to be made by it pursuant to
this Agreement which continues unremedied for a period ending on the
earlier of (A) 15 days following the date such Servicing Advance was first
required to be made, and (B) either, if applicable, (1) in the case of a
Servicing Advance relating to the payment of insurance premiums, the day on
which such insurance coverage terminates if such premiums are not paid or
(2) in the case of a Servicing Advance relating to the payment of real
estate taxes, the date of the commencement of a foreclosure action with
respect to the failure to make such payment; 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 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 or the Special Servicer, as the case may be, by the Trustee or the
Depositor, or to the Master Servicer or the Special Servicer, as the case
may be by the Holders of Certificates entitled to not less than 25% of the
Voting Rights; provided,
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however, that if such covenant or agreement is capable of being cured and
the Master Servicer or Special Servicer, as applicable, is diligently
pursuing such cure, such 30 day period shall be extended for an additional
30 days; or
(v) any breach on the part of the Master Servicer or the Special
Servicer of any representation or warranty contained in this Agreement
which 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 by the Trustee or the Depositor, or to the Master Servicer or the
Special Servicer, as the case may be by the Holders of Certificates
entitled to not less than 25% of the Voting Rights; provided, however, if
such breach is capable of being cured and the Master Servicer or Special
Servicer, as applicable, such 30 day period shall be extended for an
additional 30 days; 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,
marshalling 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, marshalling
of assets and liabilities or similar proceedings of or relating to it or of
or relating to all or substantially all of its property;
(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 of its obligations, or take any
corporate action in furtherance of the foregoing; or
(ix) the Trustee shall have received written notice from either Rating
Agency that the continuation of the Master Servicer or the Special Servicer
in such capacity would result in the downgrade, qualification or withdrawal
of any rating then assigned by such Rating Agency to any Class of
Certificates.
(b) If any Event of Default with respect to the Master Servicer or the
Special Servicer (in either case for purposes of this Section 7.01(b), the
"Defaulting Party") shall occur and be continuing, then, and in each and every
such case, so long as such Event of Default shall
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not have been remedied, the Depositor or the Trustee may, and at the written
direction of the Holders of Certificates entitled to at least 51% of the Voting
Rights, the Trustee shall terminate, by notice in writing to the Defaulting
Party, with a copy of such notice to the Depositor (if the termination is
effected by the Trustee) or to the Trustee (if the termination is effected by
the Depositor), all of the rights and obligations of the Defaulting Party under
this Agreement and in and to the Mortgage Loans and the proceeds thereof (other
than any rights of the Defaulting Party as Certificateholder). From and after
the receipt by the Defaulting Party of such written notice, 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 agrees 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 or any other Successor
Master Servicer or Special Servicer with all documents and records requested by
it to enable it to assume the Master Servicer's or Special Servicer's, as the
case may be, functions hereunder, and shall cooperate with the Trustee or any
other Successor Master Servicer or Special Servicer 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, the
transfer within two Business Days to the Trustee or any other Successor Master
Servicer or Special Servicer for administration by it of all cash amounts which
shall at the time be or should have been credited by the Master Servicer or the
Special Servicer to the Certificate Account, the Distribution Account, the REO
Account or any Servicing Account or thereafter be received with respect to the
Mortgage Loans or any REO Property (provided, however, that the Master Servicer
and the Special Servicer each shall 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 made by it or otherwise, and it
and its directors, officers, employees and agents shall continue to be entitled
to the benefits of Section 6.03 notwithstanding any such termination).
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 be
subject to all the responsibilities, duties and liabilities relating thereto and
arising thereafter placed on the Master Servicer or the Special Servicer, as the
case may be, by the terms and provisions hereof, including, without limitation,
the Master Servicer's obligation
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to make Delinquency Advances; provided that any failure to perform such duties
or responsibilities caused by the Master Servicer's or the Special Servicer's
failure to provide information or monies required by Section 7.01 shall not be
considered a default by the Trustee hereunder. The Trustee shall not be liable
for any of the representations and warranties of the Master Servicer or the
Special Servicer or for any losses incurred by the Master Servicer or the
Special Servicer 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 the applicable Servicing Fees and all funds
relating to the Mortgage Loans which the Master Servicer or the Special Servicer
would have been entitled to charge to the Certificate Account or the
Distribution Account if the Master Servicer or the Special Servicer had
continued to act hereunder. Notwithstanding the above, the Trustee may, if it
shall be unwilling to so act, or shall, if it is unable to so act or if the
Holders of Certificates entitled to at least 51% of the Voting Rights so request
in writing to the Trustee or if it is not appropriately rated as a master
servicer or special servicer, as the case may be, by each Rating Agency,
promptly appoint any FNMA- or FHLMC-approved mortgage loan servicing institution
that has a net worth of not less than $10,000,000 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 result in the downgrade,
qualification or withdrawal of its rating then assigned to any Class of
Certificates), as the successor to the Master Servicer hereunder or the Special
Servicer, as the case may be, in the assumption of all or any part of the
responsibilities, duties or liabilities of the Master Servicer or the Special
Servicer, as the case may be, hereunder. No appointment of a successor to the
Master Servicer or the Special Servicer, as the case may be, hereunder shall be
effective until the assumption of the successor to the Master Servicer or the
Special Servicer, as the case may be, of all the responsibilities, duties and
liabilities of the Master Servicer or the Special Servicer, as the case may be,
hereunder. Pending appointment of a successor to the Master Servicer or the
Special Servicer, as the case may be, hereunder, the Trustee shall act in such
capacity as hereinabove provided. 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 Mortgage Loans or otherwise 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. The Depositor, the Trustee and such successor 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 or any appointment of a successor to the
Master Servicer or the Special Servicer pursuant to Section 7.02, the Trustee
shall give prompt written notice thereof to Certificateholders at their
respective addresses appearing in the Certificate Register.
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(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 the Trustee would be
deemed to have notice of the occurrence of such an event in accordance with
Section 8.02(vii), the Trustee shall transmit by mail to the Depositor and all
Certificateholders notice of such occurrence, unless such default shall have
been cured.
SECTION 7.04 Waiver of Events of Default.
The Holders of Certificates 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 clause (i) or (ii) of Section 7.01 may be waived only by all of
the Certificateholders of the affected Classes. Upon any such waiver of an Event
of Default, such Event of Default shall cease to exist and shall be deemed to
have been remedied for every purpose hereunder. No such waiver shall extend to
any subsequent or other Event of Default or impair any right consequent thereon
except to the extent expressly so waived. Notwithstanding any other provisions
of this Agreement, for purposes of waiving any Event of Default pursuant to this
Section 7.04, Certificates registered in the name of the Depositor or any
Affiliate of the Depositor shall be entitled to the same Voting Rights with
respect to the matters described above as they would if any other Person held
such Certificates.
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ARTICLE VIII
CONCERNING THE TRUSTEE AND THE FISCAL AGENT
SECTION 8.01 Duties of Trustee and Fiscal Agent.
(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 (other than as successor Master Servicer or Special Servicer) 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. 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. Neither the Trustee nor the Fiscal Agent shall 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 or any other person and
accepted by the Trustee or the Fiscal Agent in good faith, pursuant to this
Agreement.
(c) No provision of this Agreement shall be construed to relieve the
Trustee or the Fiscal Agent from liability for its own negligent action, its own
negligent failure to act or its own willful 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 and the Fiscal Agent shall be determined
solely by the express provisions of this Agreement, the Trustee and the
Fiscal Agent 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 or the Fiscal Agent and, in the absence of bad faith on the part of
the Trustee or the Fiscal Agent, the Trustee and the Fiscal Agent may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or opinions furnished
to
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the Trustee or the Fiscal Agent and conforming to the requirements of this
Agreement;
(ii) Neither the Trustee nor the Fiscal Agent shall be personally
liable for an error of judgment made in good faith by a Responsible Officer
or Responsible Officers of the Trustee or the Fiscal Agent, unless it shall
be proved that the Trustee was negligent in ascertaining the pertinent
facts; and
(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.
SECTION 8.02 Certain Matters Affecting the Trustee and the Fiscal Agent.
Except as otherwise provided in Section 8.01:
(i) The Trustee and the Fiscal Agent may rely upon and shall be
protected in acting or refraining from acting upon any resolution,
Officer's Certificate, certificate of auditors or any other certificate,
statement, instrument, 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 and the Fiscal Agent 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) Neither the Trustee nor the Fiscal Agent (in their respective
capacities as such) shall be under any 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 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 or the Fiscal Agent, as applicable, reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby; neither the Trustee nor the Fiscal Agent shall 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
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such funds or adequate indemnity against such risk or liability is not
reasonably assured to it; nothing contained herein shall, however, 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) Neither the Trustee nor the Fiscal Agent shall 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 50% 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,
provided that the Trustee shall not be relieved from such duties, and the
Trustee shall remain responsible for all acts and omissions of any such
agent;
(vii) For all purposes under this Agreement, the Trustee shall not be
deemed to have notice of any Event of Default unless a Responsible Officer
of the Trustee has actual knowledge thereof or unless written notice of any
event which is in fact such a default is received by the Trustee at the
Corporate Trust Office, and such notice references the Certificates or this
Agreement; and
(viii) Neither the Trustee nor the Fiscal Agent shall 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,
as the case may be) or of the Depositor or any other person.
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SECTION 8.03 Trustee and Fiscal Agent not Liable for Validity or
Sufficiency of Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates, other than the
representations and warranties of, and the other statements attributed to the
Trustee in Sections 2.02, 2.05, 2.07 and 8.13 and the signature of the Trustee
set forth on each outstanding Certificate, shall be taken as the statements of
the Depositor, the Master Servicer or the Special Servicer, as the case may be,
and neither the Trustee nor the Fiscal Agent assume responsibility for their
correctness. Neither the Trustee nor the Fiscal Agent make any representations
as to the validity or sufficiency of this Agreement (except to the extent set
forth in Section 8.13) or of any Certificate (other than as to the signature of
the Trustee set forth thereon) or of any Mortgage Loan or related document.
Neither the Trustee nor the Fiscal Agent shall 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. Neither the Trustee nor the Fiscal Agent shall 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 or the
Fiscal Agent in good faith, pursuant to this Agreement.
SECTION 8.04 Trustee and the Fiscal Agent May Own Certificates.
Each of the Trustee and the Fiscal Agent, in their individual or any other
capacity, may become the owner or pledgee of Certificates with the same rights
it would have if it were not Trustee or the Fiscal Agent.
SECTION 8.05 Fees and Expenses of Trustee; Indemnification of Trustee and
the Fiscal Agent.
(a) Monthly, the Trustee shall be entitled to receive the Trustee Fee from
the Master Servicer for all services rendered by it in the execution of the
trusts hereby created and in the exercise and performance of any of the powers
and duties hereunder of the Trustee. On or prior to the Distribution Date in
each month, the Trustee shall be entitled to withdraw and pay itself from
amounts then on deposit in the Distribution Account an amount equal to the then
unpaid Trustee Fees.
(b) The Trustee, Fiscal Agent and any director, officer, employee or agent
of the Trustee and the Fiscal Agent shall be indemnified and held harmless by
the Trust Fund (to the extent of amounts on deposit in the Distribution Account
from time to time) against any loss, liability or expense (including, without
limitation, costs and expenses of litigation, and of investigation, counsel
fees, damages, judgments and amounts paid in settlement) arising out of,
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or incurred in connection with, any act or omission of the Trustee and the
Fiscal Agent relating to the exercise and performance of any of the powers and
duties of the Trustee and the Fiscal Agent hereunder; provided that neither the
Trustee, Fiscal Agent nor any of the other above specified Persons shall be
entitled to indemnification pursuant to this Section 8.05(b) for (i) allocable
overhead, (ii) expenses or disbursements incurred or made by or on behalf of the
Trustee in the normal course of the Trustee's and the Fiscal Agent's performing
their routine duties in accordance with any of the provisions hereof, (iii) any
expense or liability specifically required to be borne thereby pursuant to the
terms hereof, or (iv) 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 reckless disregard of such
obligations or 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) shall survive any resignation or removal of the Trustee and appointment
of a successor trustee or fiscal agent.
SECTION 8.06 Eligibility Requirements for Trustee and Fiscal Agent.
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
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 long-term unsecured debt obligations of the Trustee
shall at all times be rated not less than "Aa2" by Moody's and "AA" by Fitch
(or, if not rated by Fitch, otherwise acceptable to Fitch as would not result in
a qualification, downgrade or withdrawal of the rating assigned by Fitch to any
Class of Certificates) or an equivalent rating by each Rating Agency or if and
for so long as a Fiscal Agent is appointed and acting hereunder, at least
investment grade by each Rating Agency (or, if not rated by Fitch, otherwise
acceptable to Fitch as would not result in a qualification, downgrade or
withdrawal of the rating assigned by Fitch to any Class of Certificates);
provided, that either the Trustee or the Fiscal Agent shall at all times be an
institution whose long term senior unsecured debt is rated not less than "Aa2"
or an equivalent rating by each Rating Agency or such other rating as shall not
result in the qualification, downgrade or withdrawal of any of the ratings then
assigned to the respective Classes of Certificates, as confirmed in writing by
each Rating Agency. In case at any time the Trustee or the Fiscal Agent shall
cease to be eligible in accordance with the provisions of this Section, the
Trustee or the Fiscal Agent 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
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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 either Rating
Agency to qualify, downgrade or withdraw any rating assigned thereby to any
Class of Certificates, then upon the execution and delivery of such agreement
the Trustee shall not be required to resign, and may continue in such capacity,
for so long as none of the ratings assigned by the Rating Agencies to the
Certificates is adversely affected thereby. The corporation or association
serving as Trustee may have normal banking and trust relationships with the
Depositor, the Master Servicer, the Special Servicer and their respective
Affiliates.
SECTION 8.07 Resignation and Removal of the Trustee and the Fiscal Agent.
(a) The Trustee or the Fiscal Agent may at any time resign and be
discharged from the trusts hereby created by giving written notice thereof to
the Depositor, the Master Servicer, the Special Servicer and to all
Certificateholders. Upon receiving such notice of resignation, the Depositor
shall promptly appoint a successor trustee or fiscal agent acceptable to the
Master Servicer by written instrument, in duplicate, which instrument shall be
delivered to the resigning Trustee or the Fiscal Agent and to the successor
trustee or fiscal agent. A copy of such instrument shall be delivered to the
Master Servicer, the Special Servicer and the Certificateholders by the
Depositor. If no successor trustee or fiscal agent shall have been so appointed
and have accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee or the Fiscal Agent may petition any court of
competent jurisdiction for the appointment of a successor trustee.
(b) If at any time the Trustee or Fiscal Agent 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 or Fiscal Agent shall become incapable of acting, or shall be
adjudged bankrupt or insolvent, or a receiver of the Trustee or Fiscal Agent or
of its property shall be appointed, or any public officer shall take charge or
control of the Trustee or Fiscal Agent or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then the Depositor may
remove the Trustee or Fiscal Agent and appoint a successor trustee or fiscal
agent acceptable to the Master Servicer by written instrument, in duplicate,
which instrument shall be delivered to the Trustee or Fiscal Agent so removed
and to the successor trustee or fiscal agent. 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 or the Fiscal Agent and appoint a
successor trustee or fiscal agent 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
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successor so appointed. A copy of such instrument shall be delivered to the
Depositor, the Special Servicer and the remaining Certificateholders by the
Master Servicer.
(d) Any resignation or removal of the Trustee or the Fiscal Agent and
appointment of a successor trustee or fiscal agent pursuant to any of the
provisions of this Section 8.07 shall not become effective until acceptance of
appointment by the successor trustee or fiscal agent as provided in Section
8.08. Upon any succession of the Trustee or the Fiscal Agent under this
Agreement, the predecessor Trustee or the Fiscal Agent shall be entitled to the
payment of compensation and reimbursement for services rendered and expenses
incurred (including without limitation unreimbursed Advances and interest
thereon made thereby) accrued or payable up to and including the effective date
of such termination, at such times and from such sources as if the predecessor
Trustee or the Fiscal Agent had not resigned or been removed. Any resignation or
removal of the Trustee shall be deemed to be a simultaneous removal of the
Fiscal Agent hereunder.
SECTION 8.08 Successor Trustee and the Fiscal Agent.
(a) Any successor trustee or fiscal agent appointed as provided in Section
8.07 shall execute, acknowledge and deliver to the Depositor, the Master
Servicer, the Special Servicer and to its predecessor trustee an instrument
accepting such appointment hereunder, and thereupon the resignation or removal
of the predecessor trustee or fiscal agent shall become effective and such
successor trustee or fiscal agent, without any further act, deed or conveyance,
shall become fully vested with all the rights, powers, duties and obligations of
its predecessor hereunder, with the like effect as if originally named as
trustee or fiscal agent herein. The predecessor trustee or fiscal agent shall
deliver to the successor trustee or fiscal agent all Mortgage Files and related
documents and statements held by it hereunder (other than any Mortgage Files at
the time held on its behalf by a Custodian, which Custodian shall become the
agent of the successor trustee), and the Depositor, the Master Servicer, the
Special Servicer and the predecessor trustee or fiscal agent 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 or fiscal
agent all such rights, powers, duties and obligations, and to enable the
successor trustee and fiscal agent, if applicable, to perform its obligations
hereunder.
(b) No successor trustee or fiscal agent shall accept appointment as
provided in this Section 8.08 unless at the time of such acceptance such
successor trustee or fiscal agent shall be eligible under the provisions of
Section 8.06.
(c) Upon acceptance of appointment by a successor trustee or fiscal agent
as provided in this Section 8.08, the successor trustee or fiscal agent shall
mail notice of such appointment to the Depositor and the Certificateholders.
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SECTION 8.09 Merger or Consolidation of Trustee and the Fiscal Agent.
Any entity into which the Trustee or the Fiscal Agent 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 or the Fiscal Agent
shall be a party, or any entity succeeding to the corporate trust business of
the Trustee or the Fiscal Agent, shall be the successor of the Trustee or the
Fiscal Agent hereunder, provided such entity shall be eligible under the
provisions of Section 8.06, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
SECTION 8.10 Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Fund or property securing the same may at the time be located, the
Master Servicer and the Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved by
the Trustee to act as co-trustee or co-trustees, 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 fifteen 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
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this Agreement and the conditions of this Article VIII. Each separate trustee
and co-trustee, upon its acceptance of the trusts conferred, shall be vested
with the estates or property specified in its instrument of appointment, either
jointly with the Trustee or separately, as may be provided therein, subject to
all the provisions of this Agreement, specifically including every provision of
this Agreement relating to the conduct of, affecting the liability of, or
affording protection to, the Trustee. Every such instrument shall be filed with
the Trustee.
(d) Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign 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, with the consent of the Master Servicer, appoint 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 subject to supervision
by federal or state authority, shall itself (or together with an affiliate
guaranteeing its financial performance) have a combined capital and surplus of
at least $15,000,000, shall be qualified to do business in the jurisdiction in
which it holds any Mortgage File and shall not be the Depositor, a Mortgage Loan
Seller or any Affiliate of the Depositor or a Mortgage Loan Seller. Each
Custodian shall be subject to the same obligations and standard of care as would
be imposed on the Trustee hereunder in connection with the retention of Mortgage
Files directly by the Trustee. 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.
SECTION 8.12 Access to Certain Information.
(a) On or prior to the date of the first sale of any Non-Registered
Certificate to an Independent third party, the Depositor shall provide to the
Trustee ten copies of any private placement memorandum or other disclosure
document used by the Depositor or its Affiliate in connection with the offer and
sale of the Class of Certificates to which such NonRegistered Certificate
belongs. In addition, if any such private placement memorandum or disclosure
document is revised, amended or supplemented at any time following the delivery
thereof to the Trustee, the Depositor promptly shall inform the Trustee of such
event and shall deliver to the Trustee ten copies of the private placement
memorandum or disclosure document, as revised, amended or supplemented. The
Trustee shall maintain at its offices primarily responsible for administering
the Trust Fund (or at the Primary Servicing Office of the Master
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Servicer) and shall, upon reasonable advance notice, make available during
normal business hours for review by any Holder of a Certificate, originals or
copies of the following items: (i) in the case of a Holder or prospective
transferee of a Non-Registered Certificate, any private placement memorandum or
other disclosure document relating to the Class of Certificates to which such
Non-Registered Certificate belongs, in the form most recently provided to the
Trustee; and (ii) in all cases, (A) this Agreement and any amendments hereto
entered into pursuant to Section 11.01, (B) all reports required to be delivered
to Certificateholders of the relevant Class pursuant to Section 4.02 since the
Closing Date, (C) all Officer's Certificates delivered to the Trustee since the
Closing Date pursuant to Section 3.13, (D) all accountants' reports delivered to
the Trustee since the Closing Date pursuant to Section 3.14, (E) the most recent
inspection report prepared by the Master Servicer or Special Servicer and
delivered to the Trustee in respect of each Mortgaged Property pursuant to
Section 3.12, (F) as to each Mortgage Loan pursuant to which the related
Mortgagor is required to deliver such items or the Master Servicer has otherwise
acquired such items, the most recent annual operating statement and rent roll of
the related Mortgaged Property and financial statements of the related Mortgagor
collected by the Master Servicer or the Special Servicer and delivered to the
Trustee pursuant to Section 3.12(b), (G) any and all notices and reports
delivered to the Trustee with respect to any Mortgaged Property securing a
defaulted Mortgage Loan as to which the environmental testing contemplated by
Section 3.09(c) revealed that either of the conditions set forth in clauses (i)
and (ii) of the first sentence thereof was not satisfied (but only for so long
as such Mortgaged Property or the related Mortgage Loan are part of the Trust
Fund), (H) the respective Mortgage Files, including, without limitation, any and
all modifications, waivers and amendments of the terms of a Mortgage Loan
entered into by the Master Servicer or the Special Servicer and delivered to the
Trustee pursuant to Section 3.20 (but only for so long as the affected Mortgage
Loan is part of the Trust Fund) and (I) any and all Officer's Certificates and
other evidence delivered to or retained by the Trustee to support the Master
Servicer's, Special Servicer's, or Trustee's or Fiscal Agent's determination
that any Advance was or, if made, would be a Nonrecoverable Advance. Copies of
any and all of the foregoing items will be available from the Trustee upon
request; however, the Trustee shall be permitted to require from the requesting
Certificateholder payment of a sum sufficient to cover the reasonable costs and
expenses of providing such copies.
In connection with providing access to or copies of the items described in
the preceding paragraph, the Trustee may require (a) in the case of Certificate
Owners, a written confirmation executed by the requesting Person, in form
reasonably satisfactory to the Trustee, generally to the effect that such Person
is a beneficial holder of Certificates, is requesting the information solely for
use in evaluating such Person's investment in the Certificates and will
otherwise keep such information confidential and (b) in the case of a
prospective purchaser, a written confirmation executed by the requesting Person,
in form reasonably satisfactory 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 solely for use in evaluating a possible investment
in Certificates and will otherwise keep such information confidential. All
Certificateholders, by the acceptance of their Certificates, shall be deemed to
have agreed to
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keep such information confidential. Notwithstanding the foregoing provisions of
this Section 8.12(a), the Trustee shall have no responsibility for the accuracy,
completeness or sufficiency for any purpose of any information so made available
or furnished by it pursuant to this Section 8.12(a).
(b) The Trustee shall provide or cause to be provided to the Depositor, the
Master Servicer, and the Special Servicer, and to the Office of Thrift
Supervision, the Federal Deposit Insurance Corporation, and any other federal or
state banking or insurance regulatory authority that may exercise authority over
any Certificateholder, access to the Mortgage Files and any other documentation
regarding the Mortgage Loans and the Trust Fund within its control which may be
required by this Agreement or by applicable law. Such access shall be afforded
without charge but only upon reasonable prior written request and during normal
business hours at the offices of the Trustee designated by it.
SECTION 8.13 Representations and Warranties of the Trustee and the Fiscal
Agent.
(a) The Trustee hereby represents and warrants to the Master Servicer, for
its own benefit and the benefit of the Certificateholders, and to the Special
Servicer and the Depositor, as of the Closing Date, that:
(i) The Trustee is a national banking association duly organized,
validly existing and in good standing under the laws of the United States
of America.
(ii) The execution and delivery of this Agreement by the Trustee, and
the performance and compliance with the terms of this Agreement by the
Trustee, will not violate the Trustee's 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 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) This Agreement, assuming due authorization, execution and
delivery by the Special Servicer, the Master Servicer, the Fiscal Agent and
the Depositor, constitutes a valid, legal and binding obligation of the
Trustee, enforceable against the Trustee in accordance with the terms
hereof, subject to applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditor's rights
generally, and general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
(iv) The Trustee 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
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or governmental agency having jurisdiction, which default, 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 or the
financial condition or operations of the Trustee or its properties.
(v) No litigation is pending or, to the best of the Trustee's
knowledge, threatened against the Trustee which would prohibit the Trustee
from entering into this Agreement or, in the Trustee's good faith and
reasonable judgment, is likely to materially and adversely affect the
ability of the Trustee to perform its obligations under this Agreement.
(vi) 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 of
or compliance by the Trustee with this Agreement, or the consummation by
the Trustee of any transaction contemplated hereby, other than (1) such
consents, approvals, authorization, qualifications, registrations, filings
or notices as have been obtained or made and (2) where the lack of such
consent, approval, authorization, qualification, registration, filing or
notice would not have a material adverse effect on performance by the
Trustee under this Agreement.
(b) The Fiscal Agent hereby represents and warrants to the Master Servicer,
for its own benefit and the benefit of the Certificateholders, and to the
Special Servicer and the Depositor, as of the Closing Date, that:
(i) The Fiscal Agent is an organization organized under the laws of
the Netherlands, duly organized, validly existing and in good standing
under the laws governing its creation and existence.
(ii) The execution and delivery of this Agreement by the Fiscal Agent,
and the performance and compliance with the terms of this Agreement by the
Fiscal Agent, will not violate the Fiscal Agent'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 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) This Agreement, assuming due authorization, execution and
delivery by the Special Servicer, the Master Servicer, the Trustee and the
Depositor, constitutes a valid, legal and binding obligation of the Fiscal
Agent, enforceable against the Fiscal Agent in accordance with the terms
hereof, subject to applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights
generally, and general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
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(iv) The Fiscal Agent is not in default with respect to any order or
decree of any court, or any order, regulation or demand of any federal,
state, municipal or governmental agency, which default, in the Fiscal
Agent's good faith and reasonable judgment, is likely to affect materially
and adversely either the ability of the Fiscal Agent to perform its
obligations or the financial condition or operations of the Fiscal Agent or
its properties.
(v) No litigation is pending or, to the best of the Fiscal Agent's
knowledge, threatened against the Fiscal Agent which would prohibit the
Fiscal Agent from entering into this Agreement or, in the Fiscal Agent's
good faith and reasonable judgment, is likely to materially and adversely
affect the ability of the Fiscal Agent to perform its obligations under
this Agreement.
(vi) 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 of
or compliance by the Fiscal Agent with this Agreement, or the consummation
by the Fiscal Agent of any transaction contemplated hereby, other than (1)
such consents, approvals, authorizations, qualifications, registrations,
filings or notices as have been obtained or made and (2) where the lack of
such consent, approval, authorization, qualification, registration, filing
or notice would not have a material adverse effect on the performance by
the Fiscal Agent under this Agreement.
SECTION 8.14 Filings with the Securities and Exchange Commission.
Based on information furnished to it by the Master Servicer and the
Depositor (in an 80 column unformatted electronic format acceptable to the
Trustee), the Trustee will prepare and file with the Securities and Exchange
Commission on Form 8-K (including EDGAR filings), on behalf of the Trust Fund
the Distribution Date Statement. The Trustee shall have no responsibility to
file any items other than those specified in this Section 8.14. Prior to January
2, 1999 (and each anniversary thereafter until directed by the Depositor to file
a form 15, delisting the transaction) the Trustee shall hire counsel selected by
the Depositor to file Form 10-K's on behalf of the Trust Fund for the preceding
fiscal year. Any fees and expenses accrued and incurred by the Trustee in
connection with this Section 8.14 (including reasonable attorneys' fees) shall
be reimbursed to it by the Depositor. Prior to filing any such reports, the
Trustee shall submit reports to the Depositor for review and approval.
SECTION 8.15 Fiscal Agent Termination Event.
"Fiscal Agent Termination Event," wherever used herein, means any one of
the following events:
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(i) Any failure by the Fiscal Agent to remit to the Trustee when due
any required Advances; or
(ii) 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 Fiscal Agent and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 days; or
(iii) The Fiscal Agent 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 or relating to the Fiscal Agent or of or
relating to all or substantially all of its property; or
(iv) The Fiscal Agent shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage of
any applicable bankruptcy, insolvency or reorganization statute, make an
assignment for the benefit of its creditors, voluntarily suspend payment of
its obligations, or take any corporate action in furtherance of the
foregoing; or
(v) Any Rating Agency shall indicate its intent to reduce, qualify or
withdraw the outstanding rating of any Class of Certificates because the
prospective financial condition or capacity to make Advances of the Fiscal
Agent is insufficient to maintain such rating; or
(vi) The long-term unsecured debt of the Fiscal Agent is rated below
"AA" or "Aa2", as applicable, by any Rating Agency.
SECTION 8.16 Procedure Upon Termination Event.
On the date specified in a written notice of termination given to the
Fiscal Agent pursuant to Section 8.07, all authority, power and rights of the
Fiscal Agent under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall terminate and a successor Fiscal Agent shall be appointed by
the Trustee, with the consent of the Depositor; provided that in no event shall
the termination of the Fiscal Agent be effective until Rating Agency
Confirmation shall have been obtained with respect to a successor fiscal agent.
The Fiscal Agent agrees to cooperate with the Trustee in effecting the
termination of the Fiscal Agent's responsibilities and rights hereunder as
Fiscal Agent.
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ARTICLE IX
TERMINATION
SECTION 9.01 Termination Upon Repurchase or Liquidation of All Mortgage
Loans.
Subject to Section 9.02, the Trust Fund and the respective obligations and
responsibilities under this Agreement of the Depositor, the Master Servicer, the
Special Servicer, the Fiscal Agent and the Trustee (other than the obligations
of the Trustee to provide for and make payments to Certificateholders as
hereafter set forth) shall terminate upon payment (or provision for payment) 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 (i) the purchase by the Master Servicer or the Depositor of all
Mortgage Loans and each REO Property remaining in REMIC I at a price (to be
determined as of the end of the Collection Period for the anticipated Final
Distribution Date) equal to (A) the aggregate Purchase Price of all the Mortgage
Loans included in REMIC I, plus (B) the appraised value of each REO Property, if
any, included in REMIC I (such appraisal to be conducted by an Independent MAI-
designated appraiser selected by the Master Servicer and approved by the
Trustee), minus (C) solely in the case where the Master Servicer is effecting
such purchase, the aggregate amount of unreimbursed Advances, together with any
Advance Interest accrued and payable to the Master Servicer in respect of such
Advances and any unpaid 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 (ii) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan or REO Property
remaining in REMIC I; provided, however, that in no event shall the trust
created hereby continue beyond the expiration of 21 years from the death of the
last survivor of the descendants of Joseph P. Kennedy, the late ambassador of
the United States to the Court of St. James's, living on the date hereof.
The Master Servicer or the Depositor may, at its option, elect to purchase
all of the Mortgage Loans and each REO Property remaining in the Trust Fund 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 the Master Servicer or the Depositor may so
elect to purchase all of the Mortgage Loans and each REO Property remaining in
REMIC I only if the aggregate Stated Principal Balance of the Mortgage Loans and
any REO Loans remaining in the Trust Fund at the time of such election is less
than 1% of the aggregate Cut-off Date Principal Balance of the Mortgage Loans
set forth in the Preliminary Statement. In the event that the Master Servicer or
the Depositor purchases all of the Mortgage Loans and each REO Property
remaining in REMIC I in accordance with the preceding sentence, the Master
Servicer or the Depositor, as applicable, shall deposit in the Distribution
Account not later than the Master Servicer Remittance Date relating to the
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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 (exclusive of any portion thereof would be payable to any Person
other than the Certificateholders pursuant to Section 3.05(a) if on deposit in
the Certificate Account, which portion shall be deposited in the Certificate
Account). In addition, the Master Servicer shall transfer to the Distribution
Account all amounts required to be transferred thereto on such Master Servicer
Remittance 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 deposits have been made, the Trustee shall release or cause to
be released to the Master Servicer or the Depositor, as applicable, the Mortgage
Files for the remaining Mortgage Loans and any Reserve Funds and Escrow Payments
in any Reserve Accounts or Servicing Account, as applicable, and shall execute
all assignments, endorsements and other instruments furnished to it by the
Master Servicer or the Depositor, as applicable, as shall be necessary to
effectuate transfer of the Mortgage Loans and REO Properties remaining in REMIC
I. All Credit Files for the remaining Mortgage Loans and REO Properties shall be
delivered to the purchasing entity.
Notice of any termination shall be given promptly by the Trustee by letter
to Certificateholders and, if not previously notified pursuant to the preceding
paragraph, to the other parties hereto mailed (a) in the event such notice is
given in connection with the Master Servicer's or the Depositor's purchase of
all of the Mortgage Loans and each REO Property remaining in REMIC I, 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.
Upon presentation and surrender of the Certificates by the
Certificateholders on the final Distribution Date, the Trustee 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
of such amounts payable or reimbursable to any Person pursuant to clauses
(ii)-(v) of Section 3.05(b)) shall be allocated for the purposes, in the amounts
and in accordance with the priority set forth in Section 4.01. Any funds not
distributed on such Distribution Date shall be set aside and held uninvested in
trust for the benefit of Certificateholders not presenting and surrendering
their Certificates in the aforesaid manner, and shall be disposed of in
accordance with the last paragraph of Section 4.01(g).
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SECTION 9.02 Additional Termination Requirements.
(a) In the event the Master Servicer or the Depositor purchases all of the
Mortgage Loans and each REO Property remaining in REMIC I as provided in Section
9.01, the Trust Fund (and, accordingly, REMIC I, REMIC II and REMIC III) shall
be terminated in accordance with the following additional requirements, unless
the Master Servicer or the Depositor, as the case may be, obtains at its own
expense and delivers to the Trustee an Opinion of Counsel, addressed to the
Depositor, the Master Servicer and the Trustee, to the effect that the failure
of the Trust Fund to comply with the requirements of this Section 9.02 will not
(subject to Section 10.01(f)) result in the imposition of taxes on "prohibited
transactions" of REMIC I, REMIC II or REMIC III as defined in Section 860F of
the Code or cause REMIC I, REMIC II or REMIC III to fail to qualify as a REMIC
at any time that any Certificates are outstanding:
(i) the 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;
(ii) during such 90-day liquidation period and at or prior to the time
of making of the final payment on the Certificates, the Trustee shall sell
all of the assets of REMIC I to the Master Servicer or the Depositor, as
applicable, for cash; and
(iii) immediately following the making of the final payment on the
Certificates, the Trustee shall distribute or credit, or cause to be
distributed or credited, to the Holders of the related Class of Residual
Certificates all cash on hand in the related REMIC (other than cash
retained to meet claims), and 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 adopt a plan of complete liquidation of REMIC I,
REMIC II and REMIC III, which authorization shall be binding upon all successor
Certificateholders.
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ARTICLE X
ADDITIONAL REMIC PROVISIONS
SECTION 10.01 REMIC Administration.
(a) The Trustee shall make an election 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
tax or information return (including Form 8811) or any appropriate state return
for the taxable year ending on the last day of the calendar year in which the
Certificates are issued. The REMIC I Regular Interests are hereby designated as
the "regular interests" (within the meaning of Section 860G(a)(1) of the Code),
and the Class R-I Certificates are hereby designated as the sole class of
"residual interests" (within the meaning of Section 860G(a)(2) of the Code), in
REMIC I. The REMIC II Regular Interests are hereby designated as the "regular
interests" (within the meaning of Section 860G(a)(1) of the Code), and the Class
R-II Certificates are hereby designated as the sole class of "residual
interests" (within the meaning of Section 860G(a)(2) of the Code), in REMIC II.
The REMIC III Regular Certificates are hereby designated as the "regular
interests" (within the meaning of Section 860G(a)(1) of the Code) and the Class
R-III Certificates will be the sole class of "residual interests" (within the
meaning of Section 860G(a)(2) of the Code), in REMIC III. The Master Servicer,
the Special Servicer and the Trustee shall not (to the extent within the control
of each) permit the creation of any "interests" (within the meaning of Section
860G of the Code) in REMIC I, REMIC II or REMIC III other than the Certificates.
(b) The Closing Date is hereby designated as the "startup day" of each of
REMIC I, REMIC II and REMIC III within the meaning of Section 860G(a)(9) of the
Code.
(c) The Trustee, as agent for the tax matters person of each of REMIC I,
REMIC II and REMIC III, shall (i) act on behalf of the REMIC in relation to any
tax matter or controversy involving the Trust Fund and (ii) represent the Trust
Fund in any administrative or judicial proceeding relating to an examination or
audit by any governmental taxing authority with respect thereto. The legal
expenses, including without limitation attorneys' or accountants' fees, and
costs of any such proceeding and any liability resulting therefrom shall be
expenses of the Trust Fund and the Trustee shall be entitled to reimbursement
therefor out of amounts attributable to the Mortgage Loans and any REO
Properties on deposit in the Certificate Account as provided by Section 3.05(a)
unless such legal expenses and costs are incurred by reason of the Trustee's
willful misfeasance, bad faith or negligence. In the case of each of REMIC I,
REMIC II and REMIC III, the Holder of Residual Certificates representing the
largest Percentage Interest in the related Class thereof shall be designated, in
the manner provided under Treasury Regulations Section 1.860F-4(d) and temporary
Treasury Regulations Section 301.6231(a)(7)-1, as the tax matters person of such
REMIC. By its acceptance thereof, the Holder of Residual Certificates
representing the largest Percentage Interest in each Class thereof
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hereby agrees to irrevocably appoint the Trustee as its agent to perform all of
the duties of the tax matters person for the related REMIC created hereunder.
(d) The Trustee shall prepare or cause to be prepared, sign and file, in a
timely manner, all of the Tax Returns that it determines are required with
respect to each REMIC created hereunder. The expenses of preparing such returns
shall be borne by the Trustee without any right of reimbursement therefor.
(e) The Trustee shall provide (i) to any Transferor of a Residual
Certificate such information as is necessary for the application of any tax
relating to the transfer of such Residual Certificate to any Person who is not a
Permitted Transferee, (ii) to the Certificateholders such information or reports
as are required by the Code or the REMIC Provisions including reports relating
to interest, original issue discount and market discount or premium (using the
Prepayment Assumption) and (iii) to 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.
(f) The Trustee shall take such actions and shall cause each REMIC created
hereunder to take such actions as are reasonably within the Trustee's control
and the scope of its duties more specifically set forth herein as shall be
necessary to maintain the status thereof as a REMIC under the REMIC Provisions.
The Trustee shall not knowingly or intentionally take any action, cause REMIC I,
REMIC II or REMIC III to take any action or fail to take (or fail to cause to be
taken) any action reasonably within its control and the scope of duties more
specifically set forth herein, that, under the REMIC Provisions, if taken or not
taken, as the case may be, could (i) endanger the status of REMIC I, REMIC II or
REMIC III as a REMIC or (ii) result (subject to the following sentence) in the
imposition of a tax upon 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 and the tax on contributions to a REMIC set forth in Section 860G(d)
of the Code) (either such event, an "Adverse REMIC Event") unless the Trustee
receives an Opinion of Counsel (at the expense of the party seeking to take such
action or, if such party fails to pay such expense, and the Trustee determines
that taking such action is in the best interest of REMIC I, REMIC II or REMIC
III and the Certificateholders, at the expense of the Trust Fund, but in no
event at the expense of the Trustee) to the effect that the contemplated action
will not, with respect to any REMIC created hereunder endanger such status or,
unless the Master Servicer, the Trustee, or the Special Servicer, as applicable
(or other Person acceptable to the Trustee), determine that the monetary
exposure to REMIC I, REMIC II and REMIC III is not material and in its or their
sole discretion to indemnify, to the extent reasonably acceptable to the
Trustee, the Trust Fund against the imposition of such tax. Wherever in this
Agreement a contemplated action may not be taken because the timing of such
action might result in the imposition of a tax on the Trust Fund, or may only be
taken pursuant to an Opinion of Counsel that such action would not impose a tax
on the Trust Fund, such action may nonetheless be taken provided that the
indemnity given in the preceding sentence with respect to any taxes that might
be imposed on the Trust Fund has been given and that all other
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preconditions to the taking of such action have been satisfied. The Trustee
shall not take or fail to take any action (whether or not authorized hereunder)
as to which the Master Servicer has advised it in writing that it has received
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
the Trust Fund or its assets, or causing the Trust Fund to take any action,
which is not expressly permitted under the terms of this Agreement, each of the
parties hereto will consult with the Trustee or its designee, in writing, with
respect to whether such action could cause an Adverse REMIC Event to occur with
respect to REMIC I, REMIC II or REMIC III, and such party shall not take any
such action, or cause REMIC I, REMIC II or REMIC III to take any such action, as
to which the Trustee has advised it in writing that an Adverse REMIC Event could
occur. The Trustee 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. At all times as may be required by the
Code, the Trustee will to the extent within its control and the scope of its
duties as specifically set forth herein, maintain substantially all of the
assets of the Trust Fund as "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.
(g) In the event that any tax is imposed on "prohibited transactions" of
REMIC I, REMIC II or REMIC III as defined in Section 860F(a)(2) of the Code, on
"net income from foreclosure property" of REMIC I, REMIC II or REMIC III as
defined in Section 860G(c) of the Code, on any contributions to REMIC I, REMIC
II or REMIC III after the Startup Day therefor pursuant to Section 860G(d) of
the Code, or any other tax imposed by the Code or any applicable provisions of
state or local laws, such tax shall be charged (i) to the Trustee, if such tax
arises out of or results from a breach by the Trustee of any of its obligations
under this Agreement, (ii) to any other party hereto, if such tax arises out of
or results from a breach by such party of any of its obligations under this
Agreement, or (iii) otherwise (including, without limitation, in the case of any
tax permitted to be incurred pursuant to Section 3.17(a)) against amounts on
deposit in the Distribution Account as provided by Section 3.05(b).
(h) The Trustee 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 or as otherwise may be required by the REMIC
Provisions.
(i) Following the Startup Day, the Trustee shall not accept any
contributions of assets to REMIC I, REMIC II or REMIC III unless the Trustee
shall have received an Opinion of Counsel (at the expense of the party seeking
to make such contribution) to the effect that the inclusion of such assets in
such REMIC will not cause such REMIC to fail to qualify as a REMIC at any time
that any Certificates are outstanding or subject such REMIC to any tax under the
REMIC Provisions or other applicable provisions of federal, state and local law
or ordinances.
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(j) None of the Master Servicer, the Special Servicer, the Fiscal Agent or
the Trustee shall enter into any arrangement by which REMIC I, REMIC II or REMIC
III will receive a fee or other compensation for services nor (to the extent
within its control) permit REMIC I, REMIC II or REMIC III to receive any income
from assets other than "qualified mortgages" as defined in Section 860G(a)(3) of
the Code or "permitted investments" as defined in Section 860G(a)(5) of the
Code.
(k) Within 30 days after the Closing Date, the Trustee 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 each of REMIC I, REMIC II and REMIC III.
(l) None of the Trustee, the Fiscal Agent, the Master Servicer, or the
Special Servicer shall sell, dispose of or substitute for any of the Mortgage
Loans (except in connection with (i) the default, imminent default or
foreclosure of a Mortgage Loan, including but not limited to, the acquisition or
sale of a Mortgaged Property acquired by deed in lieu of foreclosure, (ii) the
bankruptcy of REMIC I, REMIC II or REMIC III, (iii) the termination of the Trust
Fund pursuant to Article IX of this Agreement or (iv) a purchase of Mortgage
Loans pursuant to or as contemplated by Section 2.03 or 3.18 of this Agreement)
or acquire any assets for the Trust Fund or sell or dispose of any investments
in the Certificate Account, the Distribution Account, or the REO Account for
gain, or accept any contributions to the Trust Fund after the Closing Date,
unless it has received an Opinion of Counsel that such sale, disposition,
substitution or acquisition will not (a) affect adversely the status of REMIC I,
REMIC II or REMIC III as a REMIC or, (b) subject to Section 10.01(f), cause
REMIC I, REMIC II or REMIC III to be subject to a tax on "prohibited
transactions" or "contributions" pursuant to the REMIC Provisions.
SECTION 10.02 Depositor, Master Servicer, Special Servicer, Fiscal Agent,
Trustee to Cooperate.
(a) The Depositor shall provide or cause to be provided to the Trustee,
within ten days after the Closing Date, all information or data that the Trustee
reasonably determines to be relevant for tax purposes as to the valuations and
issue prices of the Certificates, including, without limitation, the price,
yield, prepayment assumption and projected cash flow of the Certificates.
(b) The Master Servicer, the Special Servicer, the Fiscal Agent and the
Depositor shall each furnish such reports, certifications and information, and
access to such books and records maintained thereby, as may relate to the
Certificates or the Trust Fund and as shall be reasonably requested by the
Trustee in order to enable it to perform its duties hereunder.
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ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01 Amendment.
(a) This Agreement may be amended from time to time by the parties hereto,
without the consent of any of the Certificateholders:
(i) to cure any ambiguity,
(ii) to correct or supplement any provisions herein or therein, which may
be inconsistent with any other provisions herein or therein or to correct any
error,
(iii) to modify, eliminate or add to any of its provisions to such extent
as shall be necessary or desirable to maintain the qualification of REMIC I,
REMIC II or REMIC III as a REMIC at all times that any Certificate is
outstanding or to avoid or minimize the risk of the imposition of any tax on
REMIC I, REMIC II or REMIC III pursuant to the Code that would be a claim
against the Trust Fund, provided that the Trustee has received an Opinion of
Counsel to the effect that (A) such action is necessary or desirable to maintain
such qualification or to avoid or minimize the risk of the imposition of any
such tax and (B) such action will not adversely affect in any material respect
the interests of any Certificateholder,
(iv) to change the timing and/or nature of deposits into the Certificate
Account or the Distribution Account or to change the name in which the
Certificate Account is maintained, provided that (A) the Delinquency Advance
Date or the Master Servicer Remittance Date shall in no event be later than the
related Distribution Date, (B) such change shall not, as evidenced by an Opinion
of Counsel, adversely affect in any material respect the interests of any
Certificateholder and (C) such change shall not result in the downgrade,
qualification or withdrawal of the then-current rating assigned to any Class of
Certificates, as evidenced by a letter from each Rating Agency to such effect,
(v) to modify, eliminate or add to the provisions of Section 5.02(d) or any
other provision hereof restricting transfer of the Residual Certificates by
virtue of their being the REMIC "residual interests," provided that (A) such
change shall not adversely affect the then-current rating assigned to any Class
of Certificates, as evidenced by a letter from each Rating Agency to such
effect, and (B) such change shall not, as evidenced by an Opinion of Counsel,
cause either the Trust Fund or any of the Certificateholders (other than the
transferor) to be subject to a federal tax caused by a transfer to a Person that
is not a United States Person and a Permitted Transferee, or
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(vi) to make any other provisions with respect to matters or questions
arising under this Agreement which shall not be materially inconsistent with the
provisions of this Agreement, provided that such action shall not, as evidenced
by an Opinion of Counsel, adversely affect in any material respect the interests
of any Certificateholder.
(b) This Agreement may also be amended from time to time by the parties
hereto with the consent of the Holders of Certificates evidencing in the
aggregate not less than 66 2/3% of the Percentage Interests of each Class of
Certificates affected thereby 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 of such
Class; provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing of,
payments which are required to be distributed on any Certificate without
the consent of the Holder of such Certificate, or
(ii) reduce the aforesaid percentage of Certificates of any Class the
Holders of which are required to consent to any such amendment, in any such
case without the consent of the Holders of all Certificates of such Class
then outstanding.
(c) Notwithstanding the foregoing, the Trustee will not be entitled to
consent to any amendment hereto without having first received an Opinion or
Opinions of Counsel to the effect that (i) such amendment is permitted pursuant
to the terms of this Agreement and (ii) such amendment or the exercise of any
power granted to the Master Servicer, the Special Servicer, the Depositor, the
Trustee or any other specified person in accordance with such amendment will not
result in the imposition of a tax on REMIC I, REMIC II or REMIC III pursuant to
the REMIC Provisions or cause REMIC I, REMIC II or REMIC III to fail to qualify
as a REMIC.
(d) Promptly after the execution of any such amendment, the Trustee shall
furnish a statement describing the amendment 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) 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.
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(g) The cost of any Opinion of Counsel to be delivered pursuant to Section
11.01(a) or (c) shall be borne by the Person seeking the related amendment,
except that if the Master Servicer or the Trustee requests any amendment of this
Agreement in furtherance of the rights and interests of Certificateholders, the
cost of any Opinion of Counsel required in connection therewith pursuant to
Section 11.01(a) or (c) shall be payable out of the Certificate Account.
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 on direction by the Trustee,
such direction to be given by the Trustee only upon the Trustee's receipt of an
Opinion of Counsel to be obtained by the party requesting such recordation (the
cost of which may be paid out of the Certificate Account) to the effect that
such recordation materially and beneficially affects the interests of the
Certificateholders.
(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
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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 of any Class evidencing not less than 25% of the related Percentage
Interests in such Class shall have made written request upon the Trustee to
institute such action, suit or proceeding in its own name as Trustee hereunder
and shall have offered to the Trustee such reasonable indemnity as it may
require against the costs, expenses and liabilities to be incurred therein or
thereby, and the Trustee, for 60 days after its receipt of such notice, request
and offer of indemnity, shall have neglected or refused to institute any such
action, suit or proceeding. The Trustee shall be under no obligation to exercise
any of the trusts or powers vested in it under this Section 11.03(c) or to
institute, conduct or defend any litigation hereunder or in relation hereto at
the request, order or direction of any of the Holders of Certificates unless
such Holders have offered to the Trustee reasonable security against the costs,
expenses and liabilities which may be incurred therein or hereby. 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,
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 if personally delivered at or mailed by registered mail, postage
prepaid (except for notices to the Trustee which shall be deemed to have been
duly given only when received), to: (i) in the case of the Depositor, 650
Dresher Road, Horsham, Pennsylvania 19044, Attention: Structured Finance
Manager, telecopy number: (215) 328-1775; (ii) in the case of the Master
Servicer, 650 Dresher Road, Horsham, Pennsylvania 19044, Attention: Master
Servicing Manager, telecopy number: (215) 328-3478 (with a copy to General
Counsel (telecopy number: (215) 328-3620)); (iii) in the case of the Trustee and
the Fiscal Agent, the Corporate Trust Office; (iv) in the case
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of the Special Servicer, 550 California Street, San Francisco, California 94101,
telecopy number (415) 391-2949, Attention: CMBS Portfolio Manager (with a copy
to General Counsel); (v) in the case of the Rating Agencies, (A) Moody's
Investors Services, Inc., 99 Church Street, New York, New York 10007, Attention:
CMBS Rating and Monitoring, telecopy number: (212) 553- 1350 and (B) FITCH IBCA,
Inc., One State Street Plaza, New York, New York 10004, Attention: Commercial
Mortgage Surveillance Dept., telecopy number: (212) 635-0295; and (vi) in the
case of the Underwriters, (A) Deutsche Morgan Grenfell Inc., 31 West 52nd
Street, New York, NY 10019, Attention Steven Stuart, telecopy number: (212)
469-8518 and (B) Lehman Brothers Inc., Three World Financial Center, New York,
New York 10285, Attention Paul Hughson, telecopy number: (212) 526-3746 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. Any notice so mailed within the time prescribed in
this Agreement shall be conclusively presumed to have been duly given, whether
or not the Certificateholder receives such notice.
SECTION 11.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
SECTION 11.07 Grant of a Security Interest.
The Depositor intends that the conveyance of the Depositor's right, title
and interest in and to the Mortgage Loans pursuant to this Agreement shall
constitute a sale and not a pledge of security for a loan. If such conveyance is
deemed to be a pledge of security for a loan, however, the Depositor intends
that the rights and obligations of the parties to such loan shall be established
pursuant to the terms of this Agreement. The Depositor also intends and agrees
that, in such event, (i) the Depositor shall be deemed to have granted to the
Trustee (in such capacity) a first priority security interest in the Depositor's
entire right, title and interest in and to the assets comprising the Trust Fund,
including without limitation, the Mortgage Loans (including all Replacement
Mortgage Loans), all principal and interest received or receivable with respect
to the Mortgage Loans (other than principal and interest payments due and
payable prior to the Cut-off Date and Principal Prepayments received prior to
the Cut-off Date), all amounts held from time to time in the Certificate Account
and the Distribution Account and all reinvestment earnings on such amounts, and
all of the Depositor's right, title and interest in and to the proceeds of any
title, hazard or other Insurance Policies related to such Mortgage Loans, and
(ii) this Agreement shall constitute a security agreement under applicable law.
The
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Depositor shall file or cause to be filed, as a precautionary filing, a Form
UCC-1 substantially in the form attached as Exhibit P hereto in all appropriate
locations in the Commonwealth of Pennsylvania promptly following the initial
issuance of the Certificates, and the Master Servicer shall prepare and file at
each such office, and the Trustee shall execute, continuation statements
thereto, in each case within six months prior to the fifth anniversary of the
immediately preceding filing. The Depositor shall cooperate in a reasonable
manner with the Trustee and the Master Servicer in preparing and filing such
continuation statements. This Section 11.07 shall constitute notice to the
Trustee pursuant to any of the requirements of the applicable Uniform Commercial
Code.
SECTION 11.08 Successors and Assigns; Beneficiaries.
The provisions of this Agreement shall be binding upon and inure to the
benefit of the respective successors and assigns of the parties hereto, and all
such provisions shall inure to the benefit of the Certificateholders. No other
person, including, without limitation, any Mortgagor, shall be entitled to any
benefit or equitable right, remedy or claim under this Agreement.
SECTION 11.09 Article and Section Headings.
The article and section headings herein are for convenience of reference
only, and shall not limit or otherwise affect the meaning hereof.
SECTION 11.10 Notices to the Rating Agencies.
(a) The Trustee shall use reasonable efforts promptly to 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, termination or merger of the Master Servicer, the
Special Servicer or the Fiscal Agent;
(iv) any change in the location of the Distribution Account;
(v) a copy of the notice given pursuant to Section 2.03(a) and the
repurchase of Mortgage Loans by a Mortgage Loan Seller pursuant to Section 6 of
the related Mortgage Loan Purchase Agreement; and
(vi) the final payment to any Class of Certificateholders.
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(b) Each of the Master Servicer and the Special Servicer shall promptly
furnish to each Rating Agency copies of the following:
(i) each of its annual statements as to compliance described in Section
3.13; and
(ii) each of its annual independent public accountants' servicing reports
described in Section 3.14.
(c) To the extent it is not already required to do so under Section 4.02
hereof, the Trustee shall promptly furnish to each Rating Agency copies of each
report prepared and/or delivered by it pursuant to Section 4.02 hereof.
(d) Each of the Master Servicer, the Special Servicer and the Trustee shall
provide such additional information to each Rating Agency upon request is in its
possession or reasonably available to it.
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IN WITNESS WHEREOF, the parties hereto have caused their names to be signed
hereto by their respective officers thereunto duly authorized, in each case as
of the day and year first above written.
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.,
Depositor
By: /s/ Elisa George
--------------------------------------
Name: Elisa George
Title: Vice President
GMAC COMMERCIAL MORTGAGE CORPORATION,
Master Servicer and Special Servicer
By: /s/ Elisa George
--------------------------------------
Name: Elisa George
Title: Senior Vice President
LASALLE NATIONAL BANK,
Trustee
By: /s/ Barbara A. Wolf
--------------------------------------
Name: Barbara A. Wolf
Title: Assistant Vice President
ABN AMRO BANK N.V.,
Fiscal Agent
By: /s/ Irene Pazik
--------------------------------------
Name: Irene Pazik
Title: Vice President
By: /s/ Mary C. Casey
--------------------------------------
Name: Mary C. Casey
Title: Vice President
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STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
On the 18th day of May, 1998, before me, a notary public in and for said
State, personally appeared Elisa George known to me to be a Vice President of
GMAC COMMERCIAL MORTGAGE SECURITIES, INC., one of the corporations that executed
the within instrument, and also known to me to be the person who executed it on
behalf of such corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Maija Braunfelds
--------------------------------
Notary Public
[Notarial Seal]
Maija Braunfelds
Notary Public, State of New York
No. 03-4917450
Qualified in Bronx County
Commission Expires: 1/19/00
<PAGE>
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 18th day of May, 1998, before me, a notary public in and for said
State, personally appeared Elisa George known to me to be a Senior Vice
President of GMAC COMMERCIAL MORTGAGE CORPORATION, one of the corporations that
executed the within instrument, and also known to me to be the person who
executed it on behalf of such corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Maria Braunfelds
-----------------------------
Notary Public
[Notarial Seal]
Maija Braunfelds
Notary Public, State of New York
No. 03-4917450
Qualified in Bronx County
Commission Expires: 1/19/00
<PAGE>
STATE OF ILLINOIS )
) ss.:
COUNTY OF COOK )
On the 18th day of May 1998, before me, Kimberly W. Bell, a notary public
in and for said State, personally appeared Barbara A. Wolf, known to me to be a
Assistant Vice President of LASALLE NATIONAL BANK, one of the corporations that
executed the within instrument and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Kimberly W. Bell
---------------------------
Notary Public
[Notarial Seal]
Kimberly W. Bell
Notary Public State of Illinois
My Commission Expires 12/01/2001
<PAGE>
STATE OF ILLINOIS )
) ss.:
COUNTY OF COOK )
On the 18th day of May, 1998 before me, Kimberly Bell, a notary public in
and for said State, personally appeared Irene Pakik, Vice President and Mary C.
Casey, Vice President, respectively, of ABN AMRO BANK N.V., one of the entities
that executed the within instrument and also known to me to be the persons who
executed it on behalf of such entity, and acknowledged to me that such entity
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Kimberly W. Bell
---------------------------
Notary Public
[Notarial Seal]
Kimberly W. Bell
Notary Public State of Illinois
My Commission Expires 12/01/2001
<PAGE>
EXHIBIT A-1
FORM OF CLASS X CERTIFICATE
CLASS X MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Notional Amount of this
Variable Class X Certificate as of the Issue
Date: $[ ]
Date of Pooling and Servicing Agreement: Class Notional Amount of all the
May 1, 1998 Class X Certificates as of the Issue
Date: $1,438,000,263
Cut-off Date: May 1, 1998 Aggregate unpaid principal balance of
the Mortgage Pool as of the Cut-off
Issue Date: May 18, 1998 Date, after deducting payments of
principal due on or before such date,
First Distribution Date: June 15, 1998 whether or not received:
$1,438,000,264
Master Servicer and Special Servicer:
GMAC Commercial Mortgage Corporation Trustee: LaSalle National Bank
Certificate No. X-___ CUSIP No. [ ]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR, 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 GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 CODE. THE
<PAGE>
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 18, 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 (WITHIN THE MEANING OF
THE AGREEMENT REFERRED TO HEREIN) OF [ ]% (THE "PREPAYMENT ASSUMPTION"), 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 $[ ] OF INITIAL CERTIFICATE NOTIONAL AMOUNT, COMPUTED UNDER THE EXACT
METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL PREPAY AT A RATE
BASED ON THE PREPAYMENT ASSUMPTION OR AT ANY OTHER RATE.
THIS CERTIFICATE DOES NOT HAVE A CERTIFICATE PRINCIPAL BALANCE AND DOES NOT
ENTITLE THE HOLDER HEREOF TO ANY DISTRIBUTIONS OF PRINCIPAL. THE HOLDER HEREOF
WILL BE ENTITLED TO DISTRIBUTIONS OF INTEREST ACCRUED AS PROVIDED IN THE
AGREEMENT ON THE CERTIFICATE NOTIONAL AMOUNT OF THIS CERTIFICATE, WHICH 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 X Certificate (obtained by dividing the
notional principal amount of this Class X Certificate (its "Certificate Notional
Amount") as of the Issue Date by the aggregate notional principal balance of all
the Class X Certificates (their "Class Notional Amount") as of the Issue Date)
in that certain beneficial ownership interest evidenced by all the Class X
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 X Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on any Class X Certificate
will be made by the Trustee by wire transfer in 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 Trustee with wiring instructions no less than five Business Days prior to
the Record Date for such distribution (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions as well) and
such Certificateholder is the registered owner of all the Class X Certificates,
or otherwise by check mailed to the address of such Certificateholder appearing
in the Certificate Register. Notwithstanding the above, the final distribution
on this Certificate will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar appointed as provided in
the Agreement or such other location as may be specified in such notice.
The Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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.
A-1-2
<PAGE>
The Class X 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 X
Certificates are exchangeable for new Class X 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 X Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of a Senior Certificate or any interest therein shall be made
(i) 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 Section 4975 of the Code
(each, a "Plan"), or (ii) to any Person who is directly or indirectly purchasing
such Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless: (1) such Plan qualifies for the
exemptive relief available under the terms of Prohibited Transaction Exemption
94-29 (granted to GMAC and certain of its affiliates) and (2) at the time of
such transfer, the Senior Certificates continue to be rated in one of the top
three rating categories by at least one Rating Agency.
No service charge will be imposed for any registration of transfer or
exchange of Class X Certificates, but the Trustee or 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
X 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 662/3% 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
A-1-3
<PAGE>
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 circumstances, including any amendment necessary to maintain the status
of designated portions of the Trust Fund as a REMIC, without the consent of the
Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-1-4
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
----------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class X Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
----------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-1-6
<PAGE>
EXHIBIT A-2
FORM OF CLASS A-1 CERTIFICATE
CLASS A-1 MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
6.411% per annum this Class A-1 Certificate as of the
Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Certificate Principal Balance of all
May 1, 1998 the Class A-1 Certificates as of the
Issue Date: $333,587,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. A-1-___ CUSIP No. [ ]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR, 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 GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 CODE.
<PAGE>
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. IN ADDITION, FOLLOWING THE
DATE ON WHICH 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 MAY BE REDUCED IN CONNECTION
WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES.
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 balance of this Class A-1 Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class A-1 Certificates (their "Class Principal Balance") as of the Issue 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class A-1
Certificate will be made by the Trustee by wire transfer in 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 Trustee with wiring instructions no less than five Business
Days prior to the Record Date for such distribution (which wiring instructions
may be in the form of a standing order applicable to all subsequent
distributions as well), or otherwise by check mailed to the address of such
Certificateholder appearing in the Certificate Register. Notwithstanding the
above, the final distribution on this Certificate (determined without regard to
any possible future reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate) will be made after due notice
by the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the offices of the Certificate Registrar
appointed as provided in the Agreement or such other location as may be
specified in such notice. 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 appeared in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution Account may be made from time to time
for purposes other than, and, in certain cases,
A-2-2
<PAGE>
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 A-1 Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class A-1
Certificates are exchangeable for new Class A-1 Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class A-1 Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of a Senior Certificate or any interest therein shall be made
(i) 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 Section 4975 of the Code
(each, a "Plan"), or (ii) to any Person who is directly or indirectly purchasing
such Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless: (1) such Plan qualifies for the
exemptive relief available under the terms of Prohibited Transaction Exemption
94-29 (granted to GMAC and certain of its affiliates) and (2) at the time of
such transfer, the Senior Certificates continue to be rated in one of the top
three rating categories by at least one Rating Agency.
No service charge will be imposed for any registration of transfer or
exchange of Class A-1 Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor,
A-2-3
<PAGE>
the Master Servicer, the Special Servicer, the Trustee and the Fiscal Agent with
the consent of the Holders of Certificates entitled to at least 66 2/3% 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 circumstances, including any amendment necessary
to maintain the status of designated portions of the Trust Fund as a REMIC,
without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-2-4
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
----------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-1 Certificates referred to in the
within-mentioned Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
----------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-2-6
<PAGE>
EXHIBIT A-3
FORM OF CLASS A-2 CERTIFICATE
CLASS A-2 MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of this
6.700% per annum Class A-2 Certificate as of the Issue
Date: $[ ]
Date of Pooling and Servicing Agreement: Certificate Principal Balance of all
May 1, 1998 the Class A-2 Certificates as of the
Issue Date: $687,393,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance of
Issue Date: May 18, 1998 the Mortgage Pool as of the Cut-off
Date, after deducting payments of
First Distribution Date: June 15, 1998 principal due on or before such date,
whether or not received:
Master Servicer and Special Servicer: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. A-2-___ CUSIP No. [ ]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR, 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 GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 CODE.
<PAGE>
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. IN ADDITION, FOLLOWING THE
DATE ON WHICH 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 MAY BE REDUCED IN CONNECTION
WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES.
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 balance of this Class A-2 Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class A-2 Certificates (their "Class Principal Balance") as of the Issue 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class A-2
Certificate will be made by the Trustee by wire transfer in 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 Trustee with wiring instructions no less than five Business
Days prior to the Record Date for such distribution (which wiring instructions
may be in the form of a standing order applicable to all subsequent
distributions as well), or otherwise by check mailed to the address of such
Certificateholder appearing in the Certificate Register. Notwithstanding the
above, the final distribution on this Certificate (determined without regard to
any possible future reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate) will be made after due notice
by the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the offices of the Certificate Registrar
appointed as provided in the Agreement or such other location as may be
specified in such notice. 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 appeared in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution Account may be made from time to time
for purposes other than, and, in certain cases,
A-3-2
<PAGE>
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 A-2 Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class A-2
Certificates are exchangeable for new Class A-2 Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class A-2 Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of a Senior Certificate or any interest therein shall be made
(i) 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 Section 4975 of the Code
(each, a "Plan"), or (ii) to any Person who is directly or indirectly purchasing
such Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless: (1) such Plan qualifies for the
exemptive relief available under the terms of Prohibited Transaction Exemption
94-29 (granted to GMAC and certain of its affiliates) and (2) at the time of
such transfer, the Senior Certificates continue to be rated in one of the top
three rating categories by at least one Rating Agency.
No service charge will be imposed for any registration of transfer or
exchange of Class A-2 Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor,
A-3-3
<PAGE>
the Master Servicer, the Special Servicer, the Trustee and the Fiscal Agent with
the consent of the Holders of Certificates entitled to at least 66 2/3% 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 circumstances, including any amendment necessary
to maintain the status of designated portions of the Trust Fund as a REMIC,
without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-3-4
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
----------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-2 Certificates referred to in the
within-mentioned Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
----------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-3-6
<PAGE>
EXHIBIT A-4
FORM OF CLASS B CERTIFICATE
CLASS B MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of this
Lesser of 6.753% per annum or the Weighted Class B Certificate as of the Issue
Average Net Mortgage Rate Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class B Certificates as of the Issue
Date: $28,760,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance of
Issue Date: May 18, 1998 the Mortgage Pool as of the Cut-off
Date, after deducting payments of
First Distribution Date: June 15, 1998 principal due on or before such date,
whether or not received:
Master Servicer and Special Servicer: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. B-___ CUSIP No. [ ]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR, 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 GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
<PAGE>
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2 AND CLASS X
CERTIFICATES OF THE SAME SERIES, AS AND TO THE EXTENT PROVIDED IN AGREEMENT
REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT 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 OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT OF THE
CLASS A-1 AND CLASS A-2 CERTIFICATES OF THE SAME SERIES. IN ADDITION, FOLLOWING
THE DATE ON WHICH 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 IN CONNECTION WITH LOSSES
ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES. 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 balance of this Class B Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class B Certificates (their "Class Principal Balance") as of the Issue Date) in
that certain beneficial ownership interest evidenced by all the Class B
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class B Certificate
will be made by the Trustee by wire transfer in 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 Trustee with wiring instructions no less than five Business Days prior to
the Record Date for such distribution (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions as well), or
otherwise by check mailed to the address of such Certificateholder appearing in
the Certificate Register. Notwithstanding the above, 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
A-4-2
<PAGE>
to this Certificate) will be made after due notice by the Trustee of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar appointed as provided in
the Agreement or such other location as may be specified in such notice. 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 appeared in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 B Certificates are issuable in fully registered form only without
coupons in minimum denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Class B
Certificates are exchangeable for new Class B Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class B Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of a Class B Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class B Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in a violation of Section 406 of ERISA or Section 4975 of
the Code and will not subject the Depositor, the Trustee, the Fiscal Agent or
the Master Servicer to any obligation in addition to those undertaken in the
Agreement. In lieu of such opinion of counsel, the prospective transferee of a
Class B Certificate may provide a certification of facts substantially to the
effect that the purchase of such Certificate by or on behalf of, or with assets
of, any Plan is permissible under applicable law, will not constitute or result
in any non-exempt prohibited transaction under ERISA or Section 4975 of the
Code, will not subject the Depositor, the Trustee, the Fiscal Agent or the
Master Servicer to any obligation in addition to those undertaken in the
Agreement, and the following conditions are met: (a) the source of funds used to
purchase such Certificate is an "insurance company general account" (as such
term is defined in United States Department of Labor Prohibited Transaction
Class Exemption ("PTCE") 95-60) and (b) the conditions set forth in Sections I
and III of PTCE 95-60 have been satisfied as of the date of the acquisition of
such Certificate. In addition, so long as the Class B Certificates (or any
portion thereof) are registered in the name of Cede & Co., as nominee of DTC,
any purchaser of such Certificates will be deemed to have represented by such
purchase that either (a) such purchaser is not a Plan and is not purchasing such
A-4-3
<PAGE>
Certificates by or on behalf of, or with "plan assets" of, any Plan or (b) the
purchase of any such Certificate by or on behalf of, or with "plan assets" of,
any Plan is permissible under applicable law, will not result in any non-exempt
prohibited transaction under ERISA or Section 4975 of the Code, and will not
subject the Depositor, the Trustee, the Fiscal Agent or the Servicer to any
obligation in addition to those undertaken in the Agreement, and the following
conditions are met: (a) the source of funds used to purchase such Certificate is
an "insurance company general account" (as such term is defined in PTCE 95-60)
and (b) the conditions set forth in Sections I and III of PTCE 95-60 have been
satisfied as of the date of the acquisition of such Certificates. The Trustee
may require that any prospective transferee of a Class B Certificate that is
held as a Definitive Certificate, provide such certifications as the Trustee may
deem desirable or necessary in order to establish that such transferee or the
Person in whose name such registration is requested is not a Plan or a Person
who is directly or indirectly purchasing such Certificate on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan.
No service charge will be imposed for any registration of transfer or
exchange of Class B Certificates, but the Trustee or the Certificate Registrar
may require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of Class
B Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 662/3% 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 circumstances,
including any amendment necessary to maintain the status of designated portions
of the Trust Fund as a REMIC, without the consent of the Holders of any of the
Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-4-4
<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.
A-4-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
----------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
----------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-4-7
<PAGE>
EXHIBIT A-5
FORM OF CLASS C CERTIFICATE
CLASS C MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Lesser of 6.806% per annum or the Weighted this Class C Certificate as of the
Average Net Mortgage Rate Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class C Certificates as of the
Issue Date: $64,710,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. C-___ CUSIP No. [ ]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR, 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 GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
A-5-1
<PAGE>
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS X AND CLASS B
CERTIFICATES OF THE SAME SERIES, AS AND TO THE EXTENT PROVIDED IN THE AGREEMENT
REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT 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 OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT OF THE
CLASS A-1, CLASS A-2 AND CLASS B CERTIFICATES OF THE SAME SERIES. IN ADDITION,
FOLLOWING THE DATE ON WHICH 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 IN CONNECTION WITH LOSSES
ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES. 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 balance of this Class C Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class C Certificates (their "Class Principal Balance") as of the Issue Date) in
that certain beneficial ownership interest evidenced by all the Class C
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class C Certificate
will be made by the Trustee by wire transfer in 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 Trustee with wiring instructions no less than five Business Days prior to
the Record Date for such distribution (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions as well), or
otherwise by check mailed to the address of such Certificateholder appearing in
the Certificate Register. Notwithstanding the above, 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
A-5-2
<PAGE>
to this Certificate) will be made after due notice by the Trustee of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar appointed as provided in
the Agreement or such other location as may be specified in such notice. 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 appeared in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 C Certificates are issuable in fully registered form only without
coupons in minimum denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Class C
Certificates are exchangeable for new Class C Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class C Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of a Class C Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class C Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in a violation of Section 406 of ERISA or Section 4975 of
the Code and will not subject the Depositor, the Trustee, the Fiscal Agent or
the Master Servicer to any obligation in addition to those undertaken in the
Agreement. In lieu of such opinion of counsel, the prospective transferee of a
Class C Certificate may provide a certification of facts substantially to the
effect that the purchase of such Certificate by or on behalf of, or with assets
of, any Plan is permissible under applicable law, will not constitute or result
in any non-exempt prohibited transaction under ERISA or Section 4975 of the
Code, will not subject the Depositor, the Trustee, the Fiscal Agent or the
Master Servicer to any obligation in addition to those undertaken in the
Agreement, and the following conditions are met: (a) the source of funds used to
purchase such Certificate is an "insurance company general account" (as such
term is defined in United States Department of Labor Prohibited Transaction
Class Exemption ("PTCE") 95-60) and (b) the conditions set forth in Sections I
and III of PTCE 95-60 have been satisfied as of the date of the acquisition of
such Certificate. In addition, so long as the Class C Certificates (or any
portion thereof) are registered in the name of Cede & Co., as nominee of DTC,
any purchaser of such Certificates will be deemed to have represented by such
purchase that either (a) such purchaser is not a Plan and is not purchasing such
A-5-3
<PAGE>
Certificates by or on behalf of, or with "plan assets" of, any Plan or (b) the
purchase of any such Certificate by or on behalf of, or with "plan assets" of,
any Plan is permissible under applicable law, will not result in any non-exempt
prohibited transaction under ERISA or Section 4975 of the Code, and will not
subject the Depositor, the Trustee, the Fiscal Agent or the Servicer to any
obligation in addition to those undertaken in the Agreement, and the following
conditions are met: (a) the source of funds used to purchase such Certificate is
an "insurance company general account" (as such term is defined in PTCE 95-60)
and (b) the conditions set forth in Sections I and III of PTCE 95-60 have been
satisfied as of the date of the acquisition of such Certificates. The Trustee
may require that any prospective transferee of a Class C Certificate that is
held as a Definitive Certificate, provide such certifications as the Trustee may
deem desirable or necessary in order to establish that such transferee or the
Person in whose name such registration is requested is not a Plan or a Person
who is directly or indirectly purchasing such Certificate on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan.
No service charge will be imposed for any registration of transfer or
exchange of Class C Certificates, but the Trustee or the Certificate Registrar
may require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of Class
C Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 66 2/3% 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 circumstances,
including any amendment necessary to maintain the status of designated portions
of the Trust Fund as a REMIC, without the consent of the Holders of any of the
Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-5-4
<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.
A-5-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class C Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-5-7
<PAGE>
EXHIBIT A-6
FORM OF CLASS D CERTIFICATE
CLASS D MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Lesser of 6.974% per annum or the Weighted this Class D Certificate as of the
Average Net Mortgage Rate Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class D Certificates as of the
Issue Date: $75,495,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. D-___ CUSIP No. [ ]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR, 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 GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
<PAGE>
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS X, CLASS B
AND CLASS C CERTIFICATES OF THE SAME SERIES, AS AND TO THE EXTENT PROVIDED IN
THE AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT 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 OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT OF THE
CLASS A-1, CLASS A-2, CLASS B AND CLASS C CERTIFICATES OF THE SAME SERIES. IN
ADDITION, FOLLOWING THE DATE ON WHICH 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 IN CONNECTION
WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES.
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 balance of this Class D Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class D Certificates (their "Class Principal Balance") as of the Issue Date) in
that certain beneficial ownership interest evidenced by all the Class D
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (as to the Class D
Certificates, 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 any Class D Certificate will be made by the Trustee by wire
transfer in 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 Trustee with wiring instructions
no less than five Business Days prior to the Record Date for such distribution
(which wiring instructions may be in the form of a standing order applicable to
all subsequent distributions as well), or otherwise by check mailed to the
address of such Certificateholder appearing in the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
offices of the Certificate Registrar appointed as provided in the Agreement or
such other location as may be specified in such notice. Also notwithstanding the
foregoing, any distribution that may be made with respect to this Certificate in
reimbursement
A-6-2
<PAGE>
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 appeared in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 D Certificates are issuable in fully registered form only without
coupons in minimum denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Class D
Certificates are exchangeable for new Class D Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class D Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of a Class D Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class D Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in a violation of Section 406 of ERISA or Section 4975 of
the Code and will not subject the Depositor, the Trustee, the Fiscal Agent or
the Master Servicer to any obligation in addition to those undertaken in the
Agreement. In lieu of such opinion of counsel, the prospective transferee of a
Class D Certificate may provide a certification of facts substantially to the
effect that the purchase of such Certificate by or on behalf of, or with assets
of, any Plan is permissible under applicable law, will not constitute or result
in any non-exempt prohibited transaction under ERISA or Section 4975 of the
Code, will not subject the Depositor, the Trustee, the Fiscal Agent or the
Master Servicer to any obligation in addition to those undertaken in the
Agreement, and the following conditions are met: (a) the source of funds used to
purchase such Certificate is an "insurance company general account" (as such
term is defined in United States Department of Labor Prohibited Transaction
Class Exemption ("PTCE") 95-60) and (b) the conditions set forth in Sections I
and III of PTCE 95-60 have been satisfied as of the date of the acquisition of
such Certificate. In addition, so long as the Class D Certificates (or any
portion thereof) are registered in the name of Cede & Co., as nominee of DTC,
any purchaser of such Certificates will be deemed to have represented by such
purchase that either (a) such purchaser is not a Plan and is not purchasing such
Certificates by or on behalf of, or with "plan assets" of, any Plan or (b) the
purchase of any such Certificate by or on behalf of, or with "plan assets" of,
any Plan is permissible under applicable law, will not result in any non-exempt
prohibited transaction under ERISA or Section 4975 of the Code, and will not
subject the Depositor, the
A-6-3
<PAGE>
Trustee, the Fiscal Agent or the Servicer to any obligation in addition to those
undertaken in the Agreement, and the following conditions are met: (a) the
source of funds used to purchase such Certificate is an "insurance company
general account" (as such term is defined in PTCE 95-60) and (b) the conditions
set forth in Sections I and III of PTCE 95-60 have been satisfied as of the date
of the acquisition of such Certificates. The Trustee may require that any
prospective transferee of a Class D Certificate that is held as a Definitive
Certificate, provide such certifications as the Trustee may deem desirable or
necessary in order to establish that such transferee or the Person in whose name
such registration is requested is not a Plan or a Person who is directly or
indirectly purchasing such Certificate on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan.
No service charge will be imposed for any registration of transfer or
exchange of Class D Certificates, but the Trustee or the Certificate Registrar
may require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of Class
D Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 66 2/3% 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 circumstances,
including any amendment necessary to maintain the status of designated portions
of the Trust Fund as a REMIC, without the consent of the Holders of any of the
Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-6-4
<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.
A-6-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class D Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-6-7
<PAGE>
EXHIBIT A-7
FORM OF CLASS E CERTIFICATE
CLASS E MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Weighted Average Net Mortgage Rate this Class E Certificate as of the
Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class E Certificates as of the
Issue Date: $68,305,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. E-___ CUSIP No. [ ]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR, 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 GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 X, CLASS B,
CLASS C AND CLASS D CERTIFICATES OF THE SAME SERIES, AS AND TO THE EXTENT
PROVIDED IN THE AGREEMENT REFERRED TO HEREIN.
<PAGE>
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT 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 OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT OF THE
CLASS A-1, CLASS A-2, CLASS B, CLASS C AND CLASS D CERTIFICATES OF THE SAME
SERIES. IN ADDITION, FOLLOWING THE DATE ON WHICH 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 IN CONNECTION
WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES.
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 balance of this Class E Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class E Certificates (their "Class Principal Balance") as of the Issue 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class E Certificate
will be made by the Trustee by wire transfer in 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 Trustee with wiring instructions no less than five Business Days prior to
the Record Date for such distribution (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions as well), or
otherwise by check mailed to the address of such Certificateholder appearing in
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate (determined without regard to any possible future reimbursement
of any Realized Loss or Additional Trust Fund Expense previously allocated to
this Certificate) will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar appointed as provided in
the Agreement or such other location as may be specified in such notice. 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 appeared in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
A-7-2
<PAGE>
Any distribution to the Holder of this Certificate in reduction of the
Certificate Principal Balance hereof is binding on such Holder and all future
Holders of this Certificate and any Certificate issued upon the transfer hereof
or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 E Certificates are issuable in fully registered form only without
coupons in minimum denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Class E
Certificates are exchangeable for new Class E Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class E Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of a Class E Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class E Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in a violation of Section 406 of ERISA or Section 4975 of
the Code and will not subject the Depositor, the Trustee, the Fiscal Agent or
the Master Servicer to any obligation in addition to those undertaken in the
Agreement. In lieu of such opinion of counsel, the prospective transferee of a
Class E Certificate may provide a certification of facts substantially to the
effect that the purchase of such Certificate by or on behalf of, or with assets
of, any Plan is permissible under applicable law, will not constitute or result
in any non-exempt prohibited transaction under ERISA or Section 4975 of the
Code, will not subject the Depositor, the Trustee, the Fiscal Agent or the
Master Servicer to any obligation in addition to those undertaken in the
Agreement, and the following conditions are met: (a) the source of funds used to
purchase such Certificate is an "insurance company general account" (as such
term is defined in United States Department of Labor Prohibited Transaction
Class Exemption ("PTCE") 95-60) and (b) the conditions set forth in Sections I
and III of PTCE 95-60 have been satisfied as of the date of the acquisition of
such Certificate. In addition, so long as the Class E Certificates (or any
portion thereof) are registered in the name of Cede & Co., as nominee of DTC,
any purchaser of such Certificates will be deemed to have represented by such
purchase that either (a) such purchaser is not a Plan and is not purchasing such
Certificates by or on behalf of, or with "plan assets" of, any Plan or (b) the
purchase of any such Certificate by or on behalf of, or with "plan assets" of,
any Plan is permissible under applicable law, will not result in any non-exempt
prohibited transaction under ERISA or Section 4975 of the Code, and will not
subject the Depositor, the Trustee, the Fiscal Agent or the Servicer to any
obligation in addition to those undertaken in the Agreement, and the following
conditions are met: (a) the source of funds used to purchase such Certificate is
an "insurance company general account" (as such term is defined in PTCE 95-60)
and (b) the conditions set forth in Sections I and III of PTCE 95-60 have been
satisfied as of the date of the acquisition of such Certificates. The Trustee
may require that any prospective transferee of a Class E Certificate that is
held as a Definitive Certificate, provide such certifications as the Trustee may
deem desirable or necessary in order to establish that such transferee or the
Person in whose
A-7-3
<PAGE>
name such registration is requested is not a Plan or a Person who is directly or
indirectly purchasing such Certificate on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan.
No service charge will be imposed for any registration of transfer or
exchange of Class E Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 66 2/3% 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 circumstances,
including any amendment necessary to maintain the status of designated portions
of the Trust Fund as a REMIC, without the consent of the Holders of any of the
Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-7-4
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class E Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-7-6
<PAGE>
EXHIBIT A-8
FORM OF CLASS F CERTIFICATE
CLASS F MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Weighted Average Net Mortgage Rate this Class F Certificate as of the
Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class F Certificates as of the
Issue Date: $43,140,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. F-___ CUSIP No. [ ]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR, 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 GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 X, CLASS B,
CLASS C, CLASS D AND CLASS E CERTIFICATES OF THE SAME SERIES, AS AND TO THE
EXTENT PROVIDED IN THE AGREEMENT REFERRED TO HEREIN.
<PAGE>
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT 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 OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MAY 18, 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 (WITHIN THE MEANING OF
THE AGREEMENT) OF [ ]% (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $[ ] OF OID PER $[ ] OF INITIAL CERTIFICATE PRINCIPAL
AMOUNT, THE YIELD TO MATURITY IS [ ]% PER ANNUM AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ] PER $[ ] OF
INITIAL CERTIFICATE PRINCIPAL 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.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT OF THE
CLASS A-1, CLASS A-2, CLASS B, CLASS C, CLASS D AND CLASS E CERTIFICATES OF THE
SAME SERIES. IN ADDITION, FOLLOWING THE DATE ON WHICH THE AGGREGATE CERTIFICATE
PRINCIPAL BALANCES OF THE CLASS G, CLASS H, CLASS J, CLASS K, CLASS L, CLASS M
AND CLASS N CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, THE CERTIFICATE
PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED IN CONNECTION WITH LOSSES
ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE. 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 F Certificate (obtained by dividing the
principal balance of this Class F Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class F Certificates (their "Class Principal Balance") as of the Issue 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such
A-8-2
<PAGE>
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 any Class F Certificate will be made by the Trustee by wire
transfer in 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 Trustee with wiring instructions
no less than five Business Days prior to the Record Date for such distribution
(which wiring instructions may be in the form of a standing order applicable to
all subsequent distributions as well), or otherwise by check mailed to the
address of such Certificateholder appearing in the Certificate Register.
Notwithstanding the above, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
offices of the Certificate Registrar appointed as provided in the Agreement or
such other location as may be specified in such notice. 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 appeared in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 F Certificates are issuable in fully registered form only without
coupons in minimum denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Class F
Certificates are exchangeable for new Class F Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class F Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of a Class F Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class F Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in a violation of Section 406 of ERISA or Section 4975 of
the Code and will not subject the Depositor, the Trustee, the Fiscal Agent or
the Master Servicer to any obligation in addition to those undertaken in the
Agreement. In lieu of such opinion of counsel, the prospective transferee of a
Class F
A-8-3
<PAGE>
Certificate may provide a certification of facts substantially to the effect
that the purchase of such Certificate by or on behalf of, or with assets of, any
Plan is permissible under applicable law, will not constitute or result in any
non-exempt prohibited transaction under ERISA or Section 4975 of the Code, will
not subject the Depositor, the Trustee, the Fiscal Agent or the Master Servicer
to any obligation in addition to those undertaken in the Agreement, and the
following conditions are met: (a) the source of funds used to purchase such
Certificate is an "insurance company general account" (as such term is defined
in United States Department of Labor Prohibited Transaction Class Exemption
("PTCE") 95-60) and (b) the conditions set forth in Sections I and III of PTCE
95-60 have been satisfied as of the date of the acquisition of such Certificate.
In addition, so long as the Class F Certificates (or any portion thereof) are
registered in the name of Cede & Co., as nominee of DTC, any purchaser of such
Certificates will be deemed to have represented by such purchase that either (a)
such purchaser is not a Plan and is not purchasing such Certificates by or on
behalf of, or with "plan assets" of, any Plan or (b) the purchase of any such
Certificate by or on behalf of, or with "plan assets" of, any Plan is
permissible under applicable law, will not result in any non-exempt prohibited
transaction under ERISA or Section 4975 of the Code, and will not subject the
Depositor, the Trustee, the Fiscal Agent or the Servicer to any obligation in
addition to those undertaken in the Agreement, and the following conditions are
met: (a) the source of funds used to purchase such Certificate is an "insurance
company general account" (as such term is defined in PTCE 95-60) and (b) the
conditions set forth in Sections I and III of PTCE 95-60 have been satisfied as
of the date of the acquisition of such Certificates. The Trustee may require
that any prospective transferee of a Class F Certificate that is held as a
Definitive Certificate, provide such certifications as the Trustee may deem
desirable or necessary in order to establish that such transferee or the Person
in whose name such registration is requested is not a Plan or a Person who is
directly or indirectly purchasing such Certificate on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan.
No service charge will be imposed for any registration of transfer or
exchange of Class F Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 66 2/3% of the Voting Rights allocated to the affected Classes. Any
such consent by
A-8-4
<PAGE>
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 circumstances, including any amendment
necessary to maintain the status of designated portions of the Trust Fund as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-8-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class F Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-8-7
<PAGE>
EXHIBIT A-9
FORM OF CLASS G CERTIFICATE
CLASS G MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Weighted Average Net Mortgage Rate this Class G Certificate as of the
Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class G Certificates as of the
Issue Date: $32,355,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. G-___ CUSIP No. [ ]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR, 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 GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
<PAGE>
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS X, CLASS B,
CLASS C, CLASS D, CLASS E AND CLASS F CERTIFICATES OF THE SAME SERIES, AS AND TO
THE EXTENT PROVIDED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN 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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT 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 OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MAY 18, 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 (WITHIN THE MEANING OF
THE AGREEMENT) OF [ ]% (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $[ ] OF OID PER $[ ] OF INITIAL CERTIFICATE PRINCIPAL
AMOUNT, THE YIELD TO MATURITY IS [ ]% PER ANNUM AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ] PER $[ ] OF
INITIAL CERTIFICATE PRINCIPAL 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.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT OF THE
CLASS A-1, CLASS A-2, CLASS B, CLASS C, CLASS D, CLASS E AND CLASS F
CERTIFICATES OF THE SAME SERIES. IN ADDITION, FOLLOWING THE DATE ON WHICH THE
AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS H, CLASS J, CLASS K, CLASS
L, CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED IN CONNECTION
WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES.
ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ABOVE. 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 G Certificate (obtained by dividing the
principal balance of this Class G Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class G Certificates (their "Class Principal Balance") as of the Issue 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage
A-9-2
<PAGE>
Corporation, as Master Servicer and Special Servicer, LaSalle National Bank, as
Trustee and ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined
herein, the capitalized terms used herein have the respective meanings assigned
in the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class G Certificate
will be made by the Trustee by wire transfer in 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 Trustee with wiring instructions no less than five Business Days prior to
the Record Date for such distribution (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions as well), or
otherwise by check mailed to the address of such Certificateholder appearing in
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate (determined without regard to any possible future reimbursement
of any Realized Loss or Additional Trust Fund Expense previously allocated to
this Certificate) will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar appointed as provided in
the Agreement or such other location as may be specified in such notice. 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 appeared in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 G Certificates are issuable in fully registered form only without
coupons in minimum denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Class G
Certificates are exchangeable for new Class G Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class G Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
A-9-3
<PAGE>
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 that does not require such
registration or qualification. If such a transfer of any Class G Certificate
(other than a transfer thereof by the Depositor or any Affiliate of the
Depositor) is to be made without registration under the Securities Act, then the
Trustee shall require, in order to assure compliance with such laws, receipt by
it and the Depositor of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit B-1 to the Agreement and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
Exhibit B-2 to the Agreement; and (ii) in all other cases, (A) a certificate
from the Certificateholder desiring to effect such transfer substantially in the
form attached to the Agreement as Exhibit B-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached to
the Agreement as Exhibit B-3, and (B) unless the Depositor directs otherwise, an
Opinion of Counsel satisfactory to the Trustee and the Depositor to the effect
that such transfer may be made without such registration (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, the Fiscal Agent or the
Certificate Registrar in their respective capacities as such). Notwithstanding
the foregoing, so long as the Class G Certificates (or any portion thereof) are
registered in the name of Cede & Co., as nominee of DTC, transfers of a
beneficial interest therein in accordance with the rules and procedures of the
Depository applicable to transfers by its respective participants will be
permitted if such transfer is made in accordance with Rule 144A promulgated
under the Securities Act. Any transfer of a beneficial interest in any Class G
Certificate that is registered in the name of Cede & Co., as nominee of DTC,
other than pursuant to Rule 144A, or to a transferee that wishes to take
delivery of such interest in definitive form, will be permitted upon: (A)
receipt by the Trustee and the Depositor of the documentation required by
Section 5.02(b)(i)(A) or (B) of the Agreement; (B) the execution by the Trustee,
and the authentication and delivery by the Certificate Registrar to the
transferee, of a Definitive Certificate representing such beneficial interest;
and (C) to the extent that the beneficial interest being transferred does not
represent the entire Certificate Principal Balance of the Class G Certificates,
the execution by the Trustee, and the authentication and delivery by the
Certificate Registrar to the Depository of, a Class G Certificate representing
the remaining beneficial interest of such Class G Certificates. None of the
Depositor, the Trustee, the Fiscal Agent 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 Depositor, the Trustee, the Fiscal Agent and the Certificate
Registrar against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.
No transfer of a Class G Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class G Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in a violation of Section 406 of ERISA or Section 4975 of
the Code and will not subject the Depositor, the Trustee, the Fiscal Agent or
the Master Servicer to any obligation in addition to those undertaken in the
Agreement. In lieu of such opinion of counsel, the prospective transferee of a
Class G Certificate may provide a certification of facts substantially to the
effect that the purchase of such Certificate by or on behalf of, or with assets
of, any Plan is permissible under applicable law, will not constitute or result
in any non-exempt prohibited transaction under ERISA or Section 4975 of the
Code, will not subject the Depositor, the Trustee, the Fiscal Agent or the
Master Servicer to any obligation in addition to those undertaken in the
Agreement, and the following conditions are met: (a) the source of funds used to
purchase such Certificate is an "insurance company general account" (as such
term is defined in United States Department of Labor Prohibited Transaction
Class Exemption ("PTCE") 95-60) and (b) the conditions set forth in Sections I
and III of PTCE 95-60 have been satisfied as of the date of the acquisition of
such Certificate. In addition, so long as the Class G Certificates (or any
portion
A-9-4
<PAGE>
thereof) are registered in the name of Cede & Co., as nominee of DTC, any
purchaser of such Certificates will be deemed to have represented by such
purchase that either (a) such purchaser is not a Plan and is not purchasing such
Certificates by or on behalf of, or with "plan assets" of, any Plan or (b) the
purchase of any such Certificate by or on behalf of, or with "plan assets" of,
any Plan is permissible under applicable law, will not result in any non-exempt
prohibited transaction under ERISA or Section 4975 of the Code, and will not
subject the Depositor, the Trustee, the Fiscal Agent or the Servicer to any
obligation in addition to those undertaken in the Agreement, and the following
conditions are met: (a) the source of funds used to purchase such Certificate is
an "insurance company general account" (as such term is defined in PTCE 95-60)
and (b) the conditions set forth in Sections I and III of PTCE 95-60 have been
satisfied as of the date of the acquisition of such Certificates. The Trustee
may require that any prospective transferee of a Class G Certificate that is
held as a Definitive Certificate, provide such certifications as the Trustee may
deem desirable or necessary in order to establish that such transferee or the
Person in whose name such registration is requested is not a Plan or a Person
who is directly or indirectly purchasing such Certificate on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan.
No service charge will be imposed for any registration of transfer or
exchange of Class G Certificates, but the Trustee or the Certificate Registrar
may require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of Class
G Certificates.
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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 66 2/3% 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 circumstances,
including any amendment necessary to maintain the status of designated portions
of the Trust Fund as a REMIC, without the consent of the Holders of any of the
Certificates.
A-9-5
<PAGE>
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.
A-9-6
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class G Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-9-8
<PAGE>
EXHIBIT A-10
FORM OF CLASS H CERTIFICATE
CLASS H MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Weighted Average Net Mortgage Rate this Class H Certificate as of the
Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class H Certificates as of the
Issue Date: $25,165,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. H-___ CUSIP No. [ ]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR, 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 GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
<PAGE>
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS X, CLASS B,
CLASS C, CLASS D, CLASS E, CLASS F AND CLASS G CERTIFICATES OF THE SAME SERIES,
AS AND TO THE EXTENT PROVIDED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN 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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT 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 OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MAY 18, 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 (WITHIN THE MEANING OF
THE AGREEMENT) OF [ ]% (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $[ ] OF OID PER $[ ] OF INITIAL CERTIFICATE PRINCIPAL
AMOUNT, THE YIELD TO MATURITY IS [ ]% PER ANNUM AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ] PER $[ ] OF
INITIAL CERTIFICATE PRINCIPAL 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.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT OF THE
CLASS A-1, CLASS A-2, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F AND CLASS G
CERTIFICATES OF THE SAME SERIES. IN ADDITION, FOLLOWING THE DATE ON WHICH THE
AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS J, CLASS K, CLASS L, CLASS
M AND CLASS N CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED IN CONNECTION
WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES.
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 H Certificate (obtained by dividing the
principal balance of this Class H Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class H Certificates (their "Class Principal Balance") as of the Issue Date) in
that certain beneficial ownership interest evidenced by all the Class H
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank
A-10-2
<PAGE>
N.V., as Fiscal Agent. To the extent not defined herein, the capitalized terms
used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class H Certificate
will be made by the Trustee by wire transfer in 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 Trustee with wiring instructions no less than five Business Days prior to
the Record Date for such distribution (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions as well), or
otherwise by check mailed to the address of such Certificateholder appearing in
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate (determined without regard to any possible future reimbursement
of any Realized Loss or Additional Trust Fund Expense previously allocated to
this Certificate) will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar appointed as provided in
the Agreement or such other location as may be specified in such notice. 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 appeared in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 H Certificates are issuable in fully registered form only without
coupons in minimum denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Class H
Certificates are exchangeable for new Class H Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class H Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of any Class H Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the Securities
Act, and effective registration or qualification under applicable
A-10-3
<PAGE>
state securities laws, or is made in a transaction that does not require such
registration or qualification. If such a transfer of any Class H Certificate
(other than a transfer thereof by the Depositor or any Affiliate of the
Depositor) is to be made without registration under the Securities Act, then the
Trustee shall require, in order to assure compliance with such laws, receipt by
it and the Depositor of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit B-1 to the Agreement and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
Exhibit B-2 to the Agreement; and (ii) in all other cases, (A) a certificate
from the Certificateholder desiring to effect such transfer substantially in the
form attached to the Agreement as Exhibit B-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached to
the Agreement as Exhibit B-3, and (B) unless the Depositor directs otherwise, an
Opinion of Counsel satisfactory to the Trustee and the Depositor to the effect
that such transfer may be made without such registration (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, the Fiscal Agent or the
Certificate Registrar in their respective capacities as such). None of the
Depositor, the Trustee, the Fiscal Agent 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 Depositor, the Trustee, the Fiscal Agent and the Certificate
Registrar against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.
No transfer of a Class H Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class H Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in any non-exempt prohibited transaction under Section 406
of ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee, the Fiscal Agent or the Master Servicer to any obligation in addition
to those undertaken in the Agreement. In lieu of such opinion of counsel, the
prospective transferee of a Class H Certificate may provide a certification of
facts substantially to the effect that the purchase of such Certificate by or on
behalf of, or with assets of, any Plan is permissible under applicable law, will
not constitute or result in any non-exempt prohibited transaction under ERISA or
Section 4975 of the Code, will not subject the Depositor, the Trustee, the
Fiscal Agent or the Master Servicer to any obligation in addition to those
undertaken in the Agreement, and the following conditions are met (a) the source
of funds used to purchase such Certificate is an "insurance company general
account" (as such term is defined in United States Department of Labor
Prohibited Transaction Class Exemption ("PTCE") 95-60) and (b) the conditions
set forth in Sections I and III of PTCE 95-60 have been satisfied as of the date
of the acquisition of such Certificate.
No service charge will be imposed for any registration of transfer or
exchange of Class H Certificates, but the Trustee or 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.
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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none
A-10-4
<PAGE>
of the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar or any such agent shall be affected by
notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 66 2/3% 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 circumstances,
including any amendment necessary to maintain the status of designated portions
of the Trust Fund as a REMIC, without the consent of the Holders of any of the
Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-10-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class H Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-10-7
<PAGE>
EXHIBIT A-11
FORM OF CLASS J CERTIFICATE
CLASS J MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Weighted Average Net Mortgage Rate this Class J Certificate as of the
Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class J Certificates as of the
Issue Date: $14,380,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. J-___ CUSIP No. [ ]
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 X, CLASS B,
CLASS C, CLASS D, CLASS E, CLASS F, CLASS G AND CLASS H CERTIFICATES OF THE SAME
SERIES, AS AND TO THE EXTENT PROVIDED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN 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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE
<PAGE>
OF 1986 (THE "CODE"), OR TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING
THIS CERTIFICATE OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MAY 18, 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 (WITHIN THE MEANING OF
THE AGREEMENT) OF [ ]% (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $[ ] OF OID PER $[ ] OF INITIAL CERTIFICATE PRINCIPAL
AMOUNT, THE YIELD TO MATURITY IS [ ]% PER ANNUM AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ] PER $[ ] OF
INITIAL CERTIFICATE PRINCIPAL 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.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT OF THE
CLASS A-1, CLASS A-2, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G AND
CLASS H CERTIFICATES OF THE SAME SERIES. IN ADDITION, FOLLOWING THE DATE ON
WHICH THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS K, CLASS L, CLASS
M AND CLASS N CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED IN CONNECTION
WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES.
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 balance of this Class J Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class J Certificates (their "Class Principal Balance") as of the Issue Date) in
that certain beneficial ownership interest evidenced by all the Class J
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class J Certificate
will be made by the Trustee by wire transfer in 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
A-11-2
<PAGE>
the Trustee with wiring instructions no less than five Business Days prior to
the Record Date for such distribution (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions as well), or
otherwise by check mailed to the address of such Certificateholder appearing in
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate (determined without regard to any possible future reimbursement
of any Realized Loss or Additional Trust Fund Expense previously allocated to
this Certificate) will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar appointed as provided in
the Agreement or such other location as may be specified in such notice. 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 appeared in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 J Certificates are issuable in fully registered form only without
coupons in minimum denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Class J
Certificates are exchangeable for new Class J Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class J Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of any Class J Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the Securities
Act, and effective registration or qualification under applicable state
securities laws, or is made in a transaction that does not require such
registration or qualification. If such a transfer of any Class J Certificate
(other than a transfer thereof by the Depositor or any Affiliate of the
Depositor) is to be made without registration under the Securities Act, then the
Trustee shall require, in order to assure compliance with such laws, receipt by
it and the Depositor of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit B-1 to the Agreement and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
Exhibit B-2 to the Agreement; and (ii) in all other cases, (A) a certificate
from the Certificateholder desiring to effect such transfer substantially in the
form attached to the Agreement as Exhibit B-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached to
the Agreement as Exhibit B-3, and (B) unless the Depositor directs otherwise, an
Opinion of Counsel satisfactory to the Trustee and the Depositor to the effect
that such transfer may be made without such registration (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, the Fiscal Agent or the
Certificate Registrar in their respective capacities as such). None of the
Depositor, the Trustee, the Fiscal Agent or the Certificate Registrar is
obligated to register
A-11-3
<PAGE>
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
Depositor, the Trustee, the Fiscal Agent and the Certificate Registrar against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No transfer of a Class J Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class J Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in any non-exempt prohibited transaction under Section 406
of ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee, the Fiscal Agent or the Master Servicer to any obligation in addition
to those undertaken in the Agreement. In lieu of such opinion of counsel, the
prospective transferee of a Class J Certificate may provide a certification of
facts substantially to the effect that the purchase of such Certificate by or on
behalf of, or with assets of, any Plan is permissible under applicable law, will
not constitute or result in any non-exempt prohibited transaction under ERISA or
Section 4975 of the Code, will not subject the Depositor, the Trustee, the
Fiscal Agent or the Master Servicer to any obligation in addition to those
undertaken in the Agreement, and the following conditions are met (a) the source
of funds used to purchase such Certificate is an "insurance company general
account" (as such term is defined in United States Department of Labor
Prohibited Transaction Class Exemption ("PTCE") 95-60) and (b) the conditions
set forth in Sections I and III of PTCE 95-60 have been satisfied as of the date
of the acquisition of such Certificate.
No service charge will be imposed for any registration of transfer or
exchange of Class J Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of
A-11-4
<PAGE>
Certificates entitled to at least 66 2/3% 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 circumstances, including any amendment necessary to maintain the status
of designated portions of the Trust Fund as a REMIC, without the consent of the
Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-11-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class J Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
A-11-6
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
<PAGE>
EXHIBIT A-12
FORM OF CLASS K CERTIFICATE
CLASS K MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Lesser of 6.700% per annum or the Weighted this Class K Certificate as of the
Average Net Mortgage Rate Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class K Certificates as of the
Issue Date: $25,165,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. K-___ CUSIP No. [ ]
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 X, CLASS B,
CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H AND CLASS J CERTIFICATES OF
THE SAME SERIES, AS AND TO THE EXTENT PROVIDED IN THE AGREEMENT REFERRED TO
HEREIN.
THIS CERTIFICATE HAS NOT BEEN 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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE
<PAGE>
OF 1986 (THE "CODE"), OR TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING
THIS CERTIFICATE OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MAY 18, 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 (WITHIN THE MEANING OF
THE AGREEMENT) OF [ ]% (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $[ ] OF OID PER $[ ] OF INITIAL CERTIFICATE PRINCIPAL
AMOUNT, THE YIELD TO MATURITY IS [ ]% PER ANNUM AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ] PER $[ ] OF
INITIAL CERTIFICATE PRINCIPAL 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.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT OF THE
CLASS A-1, CLASS A-2, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G,
CLASS H AND CLASS J CERTIFICATES OF THE SAME SERIES. IN ADDITION, FOLLOWING THE
DATE ON WHICH THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS L, CLASS
M AND CLASS N CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED IN CONNECTION
WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES.
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 balance of this Class K Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class K Certificates (their "Class Principal Balance") as of the Issue 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class K Certificate
will be made by the Trustee by wire transfer in 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
A-12-2
<PAGE>
provided the Trustee with wiring instructions no less than five Business Days
prior to the Record Date for such distribution (which wiring instructions may be
in the form of a standing order applicable to all subsequent distributions as
well), or otherwise by check mailed to the address of such Certificateholder
appearing in the Certificate Register. Notwithstanding the above, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate) will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the offices of the Certificate Registrar
appointed as provided in the Agreement or such other location as may be
specified in such notice. 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 appeared in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 K Certificates are issuable in fully registered form only without
coupons in minimum denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Class K
Certificates are exchangeable for new Class K Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class K Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of any Class K Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the Securities
Act, and effective registration or qualification under applicable state
securities laws, or is made in a transaction that does not require such
registration or qualification. If such a transfer of any Class K Certificate
(other than a transfer thereof by the Depositor or any Affiliate of the
Depositor) is to be made without registration under the Securities Act, then the
Trustee shall require, in order to assure compliance with such laws, receipt by
it and the Depositor of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit B-1 to the Agreement and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
Exhibit B-2 to the Agreement; and (ii) in all other cases, (A) a certificate
from the Certificateholder desiring to effect such transfer substantially in the
form attached to the Agreement as Exhibit B-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached to
the Agreement as Exhibit B-3, and (B) unless the Depositor directs otherwise, an
Opinion of Counsel satisfactory to the Trustee and the Depositor to the effect
that such transfer may be made without such registration (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, the Fiscal Agent or the
Certificate Registrar in their respective capacities as such). None of the
Depositor, the Trustee, the Fiscal Agent or the Certificate Registrar is
obligated to register
A-12-3
<PAGE>
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
Depositor, the Trustee, the Fiscal Agent and the Certificate Registrar against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No transfer of a Class K Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class K Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in any non-exempt prohibited transaction under Section 406
of ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee, the Fiscal Agent or the Master Servicer to any obligation in addition
to those undertaken in the Agreement. In lieu of such opinion of counsel, the
prospective transferee of a Class K Certificate may provide a certification of
facts substantially to the effect that the purchase of such Certificate by or on
behalf of, or with assets of, any Plan is permissible under applicable law, will
not constitute or result in any non-exempt prohibited transaction under ERISA or
Section 4975 of the Code, will not subject the Depositor, the Trustee, the
Fiscal Agent or the Master Servicer to any obligation in addition to those
undertaken in the Agreement, and the following conditions are met (a) the source
of funds used to purchase such Certificate is an "insurance company general
account" (as such term is defined in United States Department of Labor
Prohibited Transaction Class Exemption ("PTCE") 95-60) and (b) the conditions
set forth in Sections I and III of PTCE 95-60 have been satisfied as of the date
of the acquisition of such Certificate.
No service charge will be imposed for any registration of transfer or
exchange of Class K Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of
A-12-4
<PAGE>
Certificates entitled to at least 66 2/3% 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 circumstances, including any amendment necessary to maintain the status
of designated portions of the Trust Fund as a REMIC, without the consent of the
Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-12-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class K Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-12-7
<PAGE>
EXHIBIT A-13
FORM OF CLASS L CERTIFICATE
CLASS L MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Lesser of 6.700% per annum or the Weighted this Class L Certificate as of the
Average Net Mortgage Rate Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class L Certificates as of the
Issue Date: $14,380,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. L-___ CUSIP No. [ ]
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 X, CLASS B,
CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, CLASS J AND CLASS K
CERTIFICATES OF THE SAME SERIES, AS AND TO THE EXTENT PROVIDED IN THE AGREEMENT
REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN 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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT
A-13-1
<PAGE>
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 OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MAY 18, 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 (WITHIN THE MEANING OF
THE AGREEMENT) OF [ ]% (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $[ ] OF OID PER $[ ] OF INITIAL CERTIFICATE PRINCIPAL
AMOUNT, THE YIELD TO MATURITY IS [ ]% PER ANNUM AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ] PER $[ ] OF
INITIAL CERTIFICATE PRINCIPAL 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.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT OF THE
CLASS A-1, CLASS A-2, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G,
CLASS H, CLASS J AND CLASS K CERTIFICATES OF THE SAME SERIES. IN ADDITION,
FOLLOWING THE DATE ON WHICH THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE
CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED IN CONNECTION
WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES.
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 balance of this Class L Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class L Certificates (their "Class Principal Balance") as of the Issue 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class L Certificate
will be made by the Trustee by wire transfer in immediately available funds to
the account of the Person
A-13-2
<PAGE>
entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Trustee with wiring
instructions no less than five Business Days prior to the Record Date for such
distribution (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions as well), or otherwise by check
mailed to the address of such Certificateholder appearing in the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
offices of the Certificate Registrar appointed as provided in the Agreement or
such other location as may be specified in such notice. 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 appeared in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 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.
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 that does not require such
registration or qualification. If such a transfer of any Class L Certificate
(other than a transfer thereof by the Depositor or any Affiliate of the
Depositor) is to be made without registration under the Securities Act, then the
Trustee shall require, in order to assure compliance with such laws, receipt by
it and the Depositor of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit B-1 to the Agreement and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
Exhibit B-2 to the Agreement; and (ii) in all other cases, (A) a certificate
from the Certificateholder desiring to effect such transfer substantially in the
form attached to the Agreement as Exhibit B-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached to
the Agreement as Exhibit B-3, and (B) unless the Depositor directs otherwise, an
Opinion of Counsel satisfactory to the Trustee and the Depositor to the effect
that such transfer may be made without such registration (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, the Fiscal Agent or the
Certificate Registrar in their respective capacities
A-13-3
<PAGE>
as such). None of the Depositor, the Trustee, the Fiscal Agent 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 Depositor, the
Trustee, the Fiscal Agent and the Certificate Registrar against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.
No transfer of a Class L Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class L Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in any non-exempt prohibited transaction under Section 406
of ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee, the Fiscal Agent or the Master Servicer to any obligation in addition
to those undertaken in the Agreement. In lieu of such opinion of counsel, the
prospective transferee of a Class L Certificate may provide a certification of
facts substantially to the effect that the purchase of such Certificate by or on
behalf of, or with assets of, any Plan is permissible under applicable law, will
not constitute or result in any non-exempt prohibited transaction under ERISA or
Section 4975 of the Code, will not subject the Depositor, the Trustee, the
Fiscal Agent or the Master Servicer to any obligation in addition to those
undertaken in the Agreement, and the following conditions are met (a) the source
of funds used to purchase such Certificate is an "insurance company general
account" (as such term is defined in United States Department of Labor
Prohibited Transaction Class Exemption ("PTCE") 95-60) and (b) the conditions
set forth in Sections I and III of PTCE 95-60 have been satisfied as of the date
of the acquisition of such Certificate.
No service charge will be imposed for any registration of transfer or
exchange of Class L Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor,
A-13-4
<PAGE>
the Master Servicer, the Special Servicer, the Trustee and the Fiscal Agent with
the consent of the Holders of Certificates entitled to at least 66 2/3% 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 circumstances, including any amendment necessary
to maintain the status of designated portions of the Trust Fund as a REMIC,
without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-13-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class L Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-13-7
<PAGE>
EXHIBIT A-14
FORM OF CLASS M CERTIFICATE
CLASS M MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Lesser of 6.700% per annum or the Weighted this Class M Certificate as of the
Average Net Mortgage Rate Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class M Certificates as of the
Issue Date: $10,785,000
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. M-___ CUSIP No. [ ]
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 X, CLASS B,
CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, CLASS J, CLASS K AND CLASS
L CERTIFICATES OF THE SAME SERIES, AS AND TO THE EXTENT PROVIDED IN THE
AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN 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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT
A-14-1
<PAGE>
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 OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MAY 18, 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 (WITHIN THE MEANING OF
THE AGREEMENT) OF [ ]% (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $[ ] OF OID PER $[ ] OF INITIAL CERTIFICATE PRINCIPAL
AMOUNT, THE YIELD TO MATURITY IS [ ]% PER ANNUM AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ] PER $[ ] OF
INITIAL CERTIFICATE PRINCIPAL 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.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT 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 AND CLASS L CERTIFICATES OF THE SAME SERIES. IN
ADDITION, FOLLOWING THE DATE ON WHICH THE AGGREGATE CERTIFICATE PRINCIPAL
BALANCE OF THE CLASS N CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED IN CONNECTION
WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN UNANTICIPATED EXPENSES.
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 balance of this Class M Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class M Certificates (their "Class Principal Balance") as of the Issue Date) in
that certain beneficial ownership interest 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class M Certificate
will be made by the Trustee by wire transfer in immediately available funds to
the account of the Person
A-14-2
<PAGE>
entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Trustee with wiring
instructions no less than five Business Days prior to the Record Date for such
distribution (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions as well), or otherwise by check
mailed to the address of such Certificateholder appearing in the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
offices of the Certificate Registrar appointed as provided in the Agreement or
such other location as may be specified in such notice. 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 appeared in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 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 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 of any Class M Certificate
(other than a transfer thereof by the Depositor or any Affiliate of the
Depositor) is to be made without registration under the Securities Act, then the
Trustee shall require, in order to assure compliance with such laws, receipt by
it and the Depositor of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit B-1 to the Agreement and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
Exhibit B-2 to the Agreement; and (ii) in all other cases, (A) a certificate
from the Certificateholder desiring to effect such transfer substantially in the
form attached to the Agreement as Exhibit B-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached to
the Agreement as Exhibit B-3, and (B) unless the Depositor directs otherwise, an
Opinion of Counsel satisfactory to the Trustee and the Depositor to the effect
that such transfer may be made without such registration (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, the Fiscal Agent or the
Certificate Registrar in their respective capacities
A-14-3
<PAGE>
as such). None of the Depositor, the Trustee, the Fiscal Agent 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 Depositor, the
Trustee, the Fiscal Agent and the Certificate Registrar against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.
No transfer of a Class M Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class M Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in any non-exempt prohibited transaction under Section 406
of ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee, the Fiscal Agent or the Master Servicer to any obligation in addition
to those undertaken in the Agreement. In lieu of such opinion of counsel, the
prospective transferee of a Class M Certificate may provide a certification of
facts substantially to the effect that the purchase of such Certificate by or on
behalf of, or with assets of, any Plan is permissible under applicable law, will
not constitute or result in any non-exempt prohibited transaction under ERISA or
Section 4975 of the Code, will not subject the Depositor, the Trustee, the
Fiscal Agent or the Master Servicer to any obligation in addition to those
undertaken in the Agreement, and the following conditions are met (a) the source
of funds used to purchase such Certificate is an "insurance company general
account" (as such term is defined in United States Department of Labor
Prohibited Transaction Class Exemption ("PTCE") 95-60) and (b) the conditions
set forth in Sections I and III of PTCE 95-60 have been satisfied as of the date
of the acquisition of such Certificate.
No service charge will be imposed for any registration of transfer or
exchange of Class M Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor,
A-14-4
<PAGE>
the Master Servicer, the Special Servicer, the Trustee and the Fiscal Agent with
the consent of the Holders of Certificates entitled to at least 66 2/3% 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 circumstances, including any amendment necessary
to maintain the status of designated portions of the Trust Fund as a REMIC,
without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-14-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class M Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-14-7
<PAGE>
EXHIBIT A-15
FORM OF CLASS N CERTIFICATE
CLASS N MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Pass-Through Rate: Certificate Principal Balance of
Lesser of 6.700% per annum or the Weighted this Class N Certificate as of the
Average Net Mortgage Rate Issue Date: $[ ]
Date of Pooling and Servicing Agreement: Class Principal Balance of all the
May 1, 1998 Class N Certificates as of the
Issue Date: $14,380,263
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. N-___ CUSIP No. [ ]
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 X, CLASS B,
CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, CLASS J, CLASS K, CLASS L
AND CLASS M CERTIFICATES OF THE SAME SERIES, AS AND TO THE EXTENT PROVIDED IN
THE AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN 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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT
<PAGE>
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 OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MAY 18, 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 (WITHIN THE MEANING OF
THE AGREEMENT) OF [ ]% (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $[ ] OF OID PER $[ ] OF INITIAL CERTIFICATE PRINCIPAL
AMOUNT, THE YIELD TO MATURITY IS [ ]% PER ANNUM AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ] PER $[ ] OF
INITIAL CERTIFICATE PRINCIPAL 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.
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN FOLLOWING RETIREMENT 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 AND CLASS M CERTIFICATES OF THE SAME SERIES.
IN ADDITION, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE
REDUCED IN CONNECTION WITH LOSSES ON THE MORTGAGE LOANS AND CERTAIN
UNANTICIPATED EXPENSES. 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 balance of this Class N Certificate (its "Certificate Principal
Balance") as of the Issue Date by the aggregate principal balance of all the
Class N Certificates (their "Class Principal Balance") as of the Issue 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the 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 any Class N Certificate
will be made by the Trustee by wire transfer in 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 Trustee with wiring instructions no less than five Business Days prior to
the Record Date for such
A-15-2
<PAGE>
distribution (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions as well), or otherwise by check
mailed to the address of such Certificateholder appearing in the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
offices of the Certificate Registrar appointed as provided in the Agreement or
such other location as may be specified in such notice. 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 appeared in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
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 Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and the Distribution 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 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.
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 that does not require such
registration or qualification. If such a transfer of any Class N Certificate
(other than a transfer thereof by the Depositor or any Affiliate of the
Depositor) is to be made without registration under the Securities Act, then the
Trustee shall require, in order to assure compliance with such laws, receipt by
it and the Depositor of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit B-1 to the Agreement and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
Exhibit B-2 to the Agreement; and (ii) in all other cases, (A) a certificate
from the Certificateholder desiring to effect such transfer substantially in the
form attached to the Agreement as Exhibit B-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached to
the Agreement as Exhibit B-3, and (B) unless the Depositor directs otherwise, an
Opinion of Counsel satisfactory to the Trustee and the Depositor to the effect
that such transfer may be made without such registration (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, the Fiscal Agent or the
Certificate Registrar in their respective capacities as such). None of the
Depositor, the Trustee, the Fiscal Agent 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
A-15-3
<PAGE>
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 Depositor, the Trustee, the Fiscal Agent
and the Certificate Registrar against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of a Class N Certificate or any interest therein shall be made
to (A) 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 Section 4975 of the Code
(each, a "Plan") or (B) any Person who is directly or indirectly purchasing the
Class N Certificate or interest therein on behalf of, as named fiduciary of, as
trustee of, or with assets of a Plan, unless the prospective transferee provides
the Trustee, the Fiscal Agent, the Master Servicer and the Depositor with a
certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in any non-exempt prohibited transaction under Section 406
of ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee, the Fiscal Agent or the Master Servicer to any obligation in addition
to those undertaken in the Agreement. In lieu of such opinion of counsel, the
prospective transferee of a Class N Certificate may provide a certification of
facts substantially to the effect that the purchase of such Certificate by or on
behalf of, or with assets of, any Plan is permissible under applicable law, will
not constitute or result in any non-exempt prohibited transaction under ERISA or
Section 4975 of the Code, will not subject the Depositor, the Trustee, the
Fiscal Agent or the Master Servicer to any obligation in addition to those
undertaken in the Agreement, and the following conditions are met (a) the source
of funds used to purchase such Certificate is an "insurance company general
account" (as such term is defined in United States Department of Labor
Prohibited Transaction Class Exemption ("PTCE") 95-60) and (b) the conditions
set forth in Sections I and III of PTCE 95-60 have been satisfied as of the date
of the acquisition of such Certificate.
No service charge will be imposed for any registration of transfer or
exchange of Class N Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 66 2/3% of the Voting Rights allocated to the affected Classes. Any
such consent by
A-15-4
<PAGE>
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 circumstances, including any amendment
necessary to maintain the status of designated portions of the Trust Fund as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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.
A-15-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class N Certificates referred to in the within-mentioned
Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-15-7
<PAGE>
EXHIBIT A-16
FORM OF CLASS R-I CERTIFICATE
CLASS R-I MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Date of Pooling and Servicing Agreement: Percentage Interest evidenced by
May 1, 1998 this Certificate in the related
Class: 100%
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. R-I-___ CUSIP No. [ ]
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 X, 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, AS AND TO THE EXTENT
PROVIDED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN 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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT 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 OR ANY INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS
<PAGE>
TRUSTEE OF, OR WITH ASSETS OF ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH THE PROCEDURES SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT. 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 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.A., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing upon 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 R-I Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on any Class R-I
Certificate will be made by the Trustee by check mailed to the address of the
Person entitled thereto, as such name and address appear in the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
offices of the Certificate Registrar appointed as provided in the Agreement or
such other location as may be specified in such notice.
The Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and Distribution 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
A-16-2
<PAGE>
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 that does not require such
registration or qualification. If such a transfer of any Class R-I Certificate
(other than a transfer thereof by the Depositor or any Affiliate of the
Depositor) is to be made without registration under the Securities Act, then the
Trustee shall require, in order to assure compliance with such laws, receipt by
it and the Depositor of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit B-1 to the Agreement and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
Exhibit B-2 to the Agreement; and (ii) in all other cases, (A) a certificate
from the Certificateholder desiring to effect such transfer substantially in the
form attached to the Agreement as Exhibit B-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached to
the Agreement as Exhibit B-3, and (B) unless the Depositor directs otherwise, an
Opinion of Counsel satisfactory to the Trustee and the Depositor to the effect
that such transfer may be made without such registration (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, the Fiscal Agent or the
Certificate Registrar in their respective capacities as such). None of the
Depositor, the Trustee, the Fiscal Agent 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 Depositor, the Trustee, the Fiscal Agent and the
Certificate Registrar against any liability that may result if the transfer is
not so exempt or is not made in accordance with such federal and state laws.
No transfer of a Class R-I Certificate or any interest therein shall be
made to (A) 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 Section 4975 of the Code
(each, 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, unless the prospective transferee
provides the Trustee, the Fiscal Agent, the Master Servicer and the Depositor
with a certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in a violation of Section 406 of ERISA or Section 4975 of
the Code and will not subject the Depositor, the Trustee, the Fiscal Agent or
the Master Servicer to any obligation in addition to those undertaken in 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 the Trustee 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 Trustee 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 a United States Person and shall promptly notify the
Trustee of any change or impending change in its status as a Permitted
Transferee or United States Person. In connection with any proposed Transfer of
any Ownership Interest in this Certificate, the Trustee 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 C-1
to the Agreement (a "Transfer Affidavit and Agreement") from the proposed
Transferee, in form and substance satisfactory to the Trustee, representing and
warranting, among other things, that such Transferee is a Permitted Transferee
and a United States Person, that it
A-16-3
<PAGE>
is not acquiring its Ownership Interest in this Certificate as a nominee,
trustee or agent for any Person that is not a Permitted Transferee or is not a
United States Person, that for so long as it retains its Ownership Interest in
this Certificate, it will endeavor to remain a Permitted Transferee and a United
States Person, 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 the Trustee has
actual knowledge that the proposed Transferee is not a Permitted Transferee or
is not a United States Person, the Trustee shall not register the Transfer of an
Ownership Interest in this Certificate to such proposed Transferee.
Each Person holding or acquiring any Ownership Interest in this Certificate
shall agree (x) to require a Transfer Affidavit and Agreement from any
prospective Transferee to whom such Person attempts to transfer its Ownership
Interest herein and (y) not to transfer its Ownership Interest unless it
provides to the Trustee a certificate substantially in the form attached as
Exhibit C-2 to the Agreement stating that, among other things, it has no actual
knowledge that such prospective Transferee is not a Permitted Transferee or is
not a United States Person. Each Person holding or acquiring an Ownership
Interest in this Certificate, by purchasing such Ownership Interest herein,
agrees to give the Trustee written notice that it is a "pass-through interest
holder" within the meaning of temporary Treasury regulation Section
1.67-3T(a)(2)(i)(A) immediately upon acquiring such Ownership Interest, if it
is, or is holding such Ownership Interest on behalf of, a "pass-through interest
holder".
The provisions of Section 5.02(d) of the Agreement may be modified, added
to or eliminated, provided that there shall have been delivered to the Trustee
the following: (a) written notification 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 withdraw, qualify or downgrade its then-current
rating of any Class of Certificates; and (b) an Opinion of Counsel, in form and
substance satisfactory to the Trustee and the Depositor, to the effect that such
modification of, addition to or elimination of such provisions will not cause
either 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 Class R-I
Certificate to a Person which is not a Permitted Transferee, or cause a Person
other than the prospective Transferee to be subject to a REMIC-related tax
caused by the Transfer of a Class R-I Certificate to a Person which is not a
Permitted Transferee.
A "Permitted Transferee" is any Transferee other than (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 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
(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(a)(2)(C) of the Code, and (v) an electing large partnership under
Section 775 of the Code and/or 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 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 "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 (except, in the
case of a partnership, to the extent provided in Treasury regulations), an
estate whose income from sources without the United States is includable 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.
A-16-4
<PAGE>
No service charge will be imposed for any registration of transfer or
exchange of Class R-I Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 66 2/3% 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 circumstances,
including any amendment necessary to maintain the status of REMIC I, REMIC II or
REMIC III 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.
A-16-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-I Certificates referred to in the
within-mentioned Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-16-7
<PAGE>
EXHIBIT A-17
FORM OF CLASS R-II CERTIFICATE
CLASS R-II MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Date of Pooling and Servicing Agreement: Percentage Interest evidenced by
May 1, 1998 this Certificate in the related
Class: 100%
Cut-off Date: May 1, 1998
Aggregate unpaid principal balance
Issue Date: May 18, 1998 of the Mortgage Pool as of the
Cut-off Date, after deducting
First Distribution Date: June 15, 1998 payments of principal due on or
before such date, whether or not
Master Servicer and Special Servicer: received: $1,438,000,264
GMAC Commercial Mortgage Corporation
Trustee: LaSalle National Bank
Certificate No. R-II-___ CUSIP No. [ ]
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 X, 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, AS AND TO THE EXTENT
PROVIDED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN 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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT 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 OR ANY INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS
<PAGE>
TRUSTEE OF, OR WITH ASSETS OF ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH THE PROCEDURES SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT. 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 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing upon 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 (as to the Class
R-II Certificates, 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 R-II Certificates on the applicable
Distribution Date pursuant to the Agreement. All distributions made under the
Agreement on any Class R-II Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto, as such name and address
appear in the Certificate Register. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the offices of the Certificate Registrar appointed as
provided in the Agreement or such other location as may be specified in such
notice.
The Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and Distribution 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
A-17-2
<PAGE>
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 that does not require such
registration or qualification. If such a transfer of any Class R-II Certificate
(other than a transfer thereof by the Depositor or any Affiliate of the
Depositor) is to be made without registration under the Securities Act, then the
Trustee shall require, in order to assure compliance with such laws, receipt by
it and the Depositor of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit B-1 to the Agreement and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
Exhibit B-2 to the Agreement; and (ii) in all other cases, (A) a certificate
from the Certificateholder desiring to effect such transfer substantially in the
form attached to the Agreement as Exhibit B-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached to
the Agreement as Exhibit B-3, and (B) unless the Depositor directs otherwise, an
Opinion of Counsel satisfactory to the Trustee and the Depositor to the effect
that such transfer may be made without such registration (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, the Fiscal Agent or the
Certificate Registrar in their respective capacities as such). None of the
Depositor, the Trustee, the Fiscal Agent 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 Depositor, the
Trustee, the Fiscal Agent, and the Certificate Registrar against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.
No transfer of a Class R-II Certificate or any interest therein shall be
made to (A) 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 Section 4975 of the Code
(each, 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, unless the prospective transferee
provides the Trustee, the Fiscal Agent, the Master Servicer and the Depositor
with a certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in a violation of Section 406 of ERISA or Section 4975 of
the Code and will not subject the Depositor, the Trustee, the Fiscal Agent or
the Master Servicer to any obligation in addition to those undertaken in 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 the Trustee 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 Trustee 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 a United States Person and shall promptly notify the
Trustee of any change or impending change in its status as a Permitted
Transferee or United States Person. In connection with any proposed Transfer of
any Ownership Interest in this in this Certificate, the Trustee 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 C-1 to the Agreement (a "Transfer Affidavit and Agreement") from the
proposed Transferee, in form and substance satisfactory to the Trustee,
representing and warranting, among other things, that such Transferee is a
Permitted Transferee and a United States Person, that it
A-17-3
<PAGE>
is not acquiring its Ownership Interest in this Certificate as a nominee,
trustee or agent for any Person that is not a Permitted Transferee or is not a
United States Person, that for so long as it retains its Ownership Interest in
this Certificate, it will endeavor to remain a Permitted Transferee and a United
States Person, 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 the Trustee has
actual knowledge that the proposed Transferee is not a Permitted Transferee or
is not a United States Person, the Trustee shall not register the Transfer of an
Ownership Interest in this Certificate to such proposed Transferee.
Each Person holding or acquiring any Ownership Interest in this Certificate
shall agree (x) to require a Transfer Affidavit and Agreement from any
prospective Transferee to whom such Person attempts to transfer its Ownership
Interest herein and (y) not to transfer its Ownership Interest unless it
provides to the Trustee a certificate substantially in the form attached as
Exhibit C-2 to the Agreement stating that, among other things, it has no actual
knowledge that such prospective Transferee is not a Permitted Transferee or is
not a United States Person. Each Person holding or acquiring an Ownership
Interest in this Certificate, by purchasing such Ownership Interest herein,
agrees to give the Trustee written notice that it is a "pass-through interest
holder" within the meaning of temporary Treasury regulation Section
1.67-3T(a)(2)(i)(A) immediately upon acquiring such Ownership Interest, if it
is, or is holding such Ownership Interest on behalf of, a "pass-through interest
holder".
The provisions of Section 5.02(d) of the Agreement may be modified, added
to or eliminated, provided that there shall have been delivered to the Trustee
the following: (a) written notification 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 withdraw, qualify or downgrade its then-current
rating of any Class of Certificates; and (b) an Opinion of Counsel, in form and
substance satisfactory to the Trustee and the Depositor, to the effect that such
modification of, addition to or elimination of such provisions will not cause
either 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 Class R-II
Certificate to a Person which is not a Permitted Transferee, or cause a Person
other than the prospective Transferee to be subject to a REMIC-related tax
caused by the Transfer of a Class R-II Certificate to a Person which is not a
Permitted Transferee.
A "Permitted Transferee" is any Transferee other than (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 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
(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(a)(2)(C) of the Code, and (v) an electing large partnership under
Section 775 of the Code and/or 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-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 "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 (except, in the
case of a partnership, to the extent provided in Treasury regulations), an
estate whose income from sources without the United States is includable 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.
A-17-4
<PAGE>
No service charge will be imposed for any registration of transfer or
exchange of Class R-II Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 66 2/3% 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 circumstances,
including any amendment necessary to maintain the status of REMIC I, REMIC II or
REMIC III 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.
A-17-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-II Certificates referred to in the
within-mentioned Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-17-7
<PAGE>
EXHIBIT A-18
FORM OF CLASS R-III CERTIFICATE
CLASS R-III MORTGAGE
PASS-THROUGH CERTIFICATE,
SERIES 1998-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool (the "Mortgage Pool") of multifamily and
commercial mortgage loans (the "Mortgage Loans"), such pool being formed and
sold by
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Date of Pooling and Servicing Agreement: Percentage Interest evidenced by
May 1, 1998 this Certificate in the related
Class: 100%
Cut-off Date: May 1, 1998 Aggregate unpaid principal balance
of the Mortgage Pool as of the
Issue Date: May 18, 1998 Cut-off Date, after deducting
payments of principal due on or
First Distribution Date: June 15, 1998 before such date, whether or not
received: $1,438,000,264
Master Servicer and Special Servicer:
GMAC Commercial Mortgage Corporation Trustee: LaSalle National Bank
Certificate No. R-III-___ CUSIP No. [ ]
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN GMAC
COMMERCIAL MORTGAGE SECURITIES, INC., GMAC COMMERCIAL MORTGAGE CORPORATION,
LASALLE NATIONAL BANK, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE 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 X, 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, AS AND TO THE EXTENT
PROVIDED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN 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 AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN TO AN EMPLOYEE BENEFIT
PLAN OR OTHER RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE
<PAGE>
OF 1986 (THE "CODE"), OR TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING
THIS CERTIFICATE OR ANY INTEREST HEREIN 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 SET
FORTH IN THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT. 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 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 GMAC Commercial
Mortgage Securities, Inc., as Depositor, GMAC Commercial Mortgage Corporation,
as Master Servicer and Special Servicer, LaSalle National Bank, as Trustee and
ABN AMRO Bank N.V., as Fiscal Agent. To the extent not defined herein, the
capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing upon 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 (as to the Class
R-III Certificates, 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 R-III Certificates on the applicable
Distribution Date pursuant to the Agreement. All distributions made under the
Agreement on any Class R-III Certificate will be made by the Trustee by check
mailed to the address of the Person entitled thereto, as such name and address
appear in the Certificate Register. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee of
the pendency of such distribution and only upon presentation and surrender of
this Certificate at the offices of the Certificate Registrar appointed as
provided in the Agreement or such other location as may be specified in such
notice.
The Depositor's Mortgage Pass-Through Certificates, Series 1998-C1 (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 and Distribution 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.
A-18-2
<PAGE>
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 that does not require such
registration or qualification. If such a transfer of any Class R-III Certificate
(other than a transfer thereof by the Depositor or any Affiliate of the
Depositor) is to be made without registration under the Securities Act, then the
Trustee shall require, in order to assure compliance with such laws, receipt by
it and the Depositor of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit B-1 to the Agreement and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
Exhibit B-2 to the Agreement; and (ii) in all other cases, (A) a certificate
from the Certificateholder desiring to effect such transfer substantially in the
form attached to the Agreement as Exhibit B-1 and a certificate from such
Certificateholder's prospective transferee substantially in the form attached to
the Agreement as Exhibit B-3, and (B) unless the Depositor directs otherwise, an
Opinion of Counsel satisfactory to the Trustee and the Depositor to the effect
that such transfer may be made without such registration (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, the Fiscal Agent or the
Certificate Registrar in their respective capacities as such). None of the
Depositor, the Trustee, the Fiscal Agent 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 Depositor,
the Trustee, the Fiscal Agent and the Certificate Registrar against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No transfer of a Class R-III Certificate or any interest therein shall be
made to (A) 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 Section 4975 of the Code
(each, 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, unless the prospective transferee
provides the Trustee, the Fiscal Agent, the Master Servicer and the Depositor
with a certification of facts and an Opinion of Counsel which establish to the
satisfaction of the Trustee, the Fiscal Agent, the Master Servicer and the
Depositor that such transfer is permissible under applicable law, will not
constitute or result in a violation of Section 406 of ERISA or Section 4975 of
the Code and will not subject the Depositor, the Trustee, the Fiscal Agent or
the Master Servicer to any obligation in addition to those undertaken in 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 the Trustee 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 Trustee 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 a United States Person and shall promptly notify the
Trustee of any change or impending change in its status as a Permitted
Transferee or United States Person. In connection with any proposed Transfer of
any Ownership Interest in this Certificate, the Trustee 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 C-1
to the Agreement (a "Transfer Affidavit
A-18-3
<PAGE>
and Agreement") from the proposed Transferee, in form and substance satisfactory
to the Trustee, representing and warranting, among other things, that such
Transferee is a Permitted Transferee and a United States Person, 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 or is not a United
States Person, that for so long as it retains its Ownership Interest in this
Certificate, it will endeavor to remain a Permitted Transferee and a United
States Person, 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 the Trustee has
actual knowledge that the proposed Transferee is not a Permitted Transferee or
is not a United States Person, the Certificate Registrar shall not register the
Transfer of an Ownership Interest in this Certificate to such proposed
Transferee.
Each Person holding or acquiring any Ownership Interest in this Certificate
shall agree (x) to require a Transfer Affidavit and Agreement from any
prospective Transferee to whom such Person attempts to transfer its Ownership
Interest herein and (y) not to transfer its Ownership Interest unless it
provides to the Trustee a certificate substantially in the form attached as
Exhibit C-2 to the Agreement stating that, among other things, it has no actual
knowledge that such prospective Transferee is not a Permitted Transferee or is
not a United States Person. Each Person holding or acquiring an Ownership
Interest in this Certificate, by purchasing such Ownership Interest herein,
agrees to give the Trustee written notice that it is a "pass-through interest
holder" within the meaning of temporary Treasury regulation Section
1.67-3T(a)(2)(i)(A) immediately upon acquiring such Ownership Interest, if it
is, or is holding such Ownership Interest on behalf of, a "pass-through interest
holder".
The provisions of Section 5.02(d) of the Agreement may be modified, added
to or eliminated, provided that there shall have been delivered to the Trustee
the following: (a) written notification 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 withdraw, qualify or downgrade its then-current
rating of any Class of Certificates; and (b) an Opinion of Counsel, in form and
substance satisfactory to the Trustee and the Depositor, to the effect that such
modification of, addition to or elimination of such provisions will not cause
either 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 Class R-III
Certificate to a Person which is not a Permitted Transferee, or cause a Person
other than the prospective Transferee to be subject to a REMIC-related tax
caused by the Transfer of a Class R-III Certificate to a Person which is not a
Permitted Transferee.
A "Permitted Transferee" is any Transferee other than (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 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
(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(a)(2)(C) of the Code, and (v) an electing large partnership under
Section 775 of the Code and/or 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-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 "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 (except, in the
case of a partnership, to the extent provided in Treasury regulations), an
estate whose income from sources without the United States is includable 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.
A-18-4
<PAGE>
No service charge will be imposed for any registration of transfer or
exchange of Class R-III Certificates, but the Trustee or 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.
Prior to due presentment of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Certificate Registrar and any agents of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Fiscal Agent, the Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and any REO Properties remaining in the Trust
Fund. The Agreement permits, but does not require, the Depositor or the Master
Servicer to purchase from the Trust Fund all Mortgage Loans and any REO
Properties 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 Cut-off Date Principal Balance of
the Mortgage Pool specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof, and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Fiscal
Agent thereunder and the rights of the Certificateholders thereunder, at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 66 2/3% 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 circumstances,
including any amendment necessary to maintain the status of REMIC I, REMIC II or
REMIC III 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.
A-18-5
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
LaSalle National Bank,
as Trustee
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-III Certificates referred to in the
within-mentioned Agreement.
Dated:
LaSalle National Bank,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to the above named assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the issuance of a new Mortgage Pass-Through
Certificate of a like Percentage Interest and Class to the above named assignee
and delivery of such Mortgage Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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.
A-18-7
<PAGE>
EXHIBIT B-1
FORM I OF TRANSFEROR CERTIFICATE
_________, 19__
LaSalle National Bank
135 South LaSalle Street
Suite 1625
Chicago, Illinois 60674-4107
Re: GMAC Commercial Mortgage Securities, Inc., Mortgage
Pass-Through Certificates Series 1998-C1, Class [G] [H] [J]
[K] [L] [M] [N], having an initial principal balance as of
May 1, 1998 of $___________
Dear Sirs:
This letter is delivered to you in connection with the transfer by (the
"Transferor") to ____________ (the "Transferee") of the captioned Certificate
(the "Certificate"), pursuant to Section 5.02 of the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of May 1, 1998,
among GMAC Commercial Mortgage Securities, Inc. as Depositor, GMAC Commercial
Mortgage Corporation, as Master Servicer and Special Servicer, LaSalle National
Bank, as Trustee and ABN AMRO Bank N.V., as Fiscal Agent. All terms used herein
and not otherwise defined shall have the respective 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 Certificate with the full
right to transfer the 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 the Certificate, any
interest in the Certificate or any other similar security to any person in any
manner, (b) solicited any offer to buy or accept a transfer, pledge or other
disposition of the Certificate, any interest in the Certificate or any other
similar security from any person in any manner, (c) otherwise approached or
negotiated with respect to the Certificate, any interest in the Certificate or
any other similar security with any person in any manner, (d) made any general
solicitation with respect to the Certificate, any interest in the Certificate or
any other similar security by means of general advertising or in any other
manner, or (e) taken any other action with respect to the Certificate, any
interest in the Certificate or any other similar security, which (in the case of
any of the acts described in clauses (a) through (e) hereof) would constitute a
distribution under the Securities Act of 1933 (the "Securities Act"), or would
render the disposition of the Certificate a violation of Section 5 of the
Securities Act or any state securities laws, or would require registration or
qualification of the Certificate pursuant to the Securities Act or any state
securities laws.
3. The Transferor and any person acting on behalf of the Transferor in this
matter reasonably believe that the Transferee is a "qualified institutional
buyer" (as that term is defined in Rule 144A ("Rule 144A") under the Securities
Act) purchasing for its own account. In determining whether the Transferee is a
"qualified institutional buyer," the Transferor and any person acting on behalf
of the Transferor in this matter has relied upon the following method(s) of
establishing the Transferee's ownership and discretionary investments of
securities (check one or more):
<PAGE>
__ (a) The Transferee's most recent publicly available financial
statements, which statements present the information as of a date within 16
months preceding the date of sale of the Certificate in the case of a U.S.
purchaser and within 18 months preceding such date of sale for a foreign
purchaser; or
__ (b) The most recent publicly available information appearing in
documents filed by the Transferee with the Securities and Exchange Commission or
another United States federal, state, or local governmental agency or
self-regulatory organization, or with a foreign governmental agency or
self-regulatory organization, which information is as of a date within 16 months
preceding the date of sale of the Certificate in the case of a U.S. purchaser
and within 18 months preceding such date of sale for a foreign purchaser; or
__ (c) The most recent publicly available information appearing in a
recognized securities manual, which information is as of a date within 16 months
preceding the date of sale of the Certificate in the case of a U.S. purchaser
and within 18 months preceding such date of sale for a foreign purchaser; or
__ (d) A certification by the chief financial officer, a person fulfilling
an equivalent function, or other executive officer of the Transferee, specifying
the amount of securities owned and invested on a discretionary basis by the
Transferee as of a specific date on or since the close of the Transferee's most
recent fiscal year, or, in the case of a Transferee that is a member of a
"family of investment companies," as that term is defined in Rule 144A, a
certification by an executive officer of the investment adviser specifying the
amount of securities owned by the "family of investment companies" as of a
specific date on or since the close of the Transferee's most recent fiscal year.
4. The Transferor and any person acting on behalf of the Transferor
understand that in determining the aggregate amount of securities owned and
invested on a discretionary basis by an entity for purposes of establishing
whether such entity is a "qualified institutional buyer:"
(a) the following instruments and interests shall be excluded:
securities of issuers that are affiliated with the Transferee; securities
that are part of an unsold allotment to or subscription by the Transferee,
if the Transferee is a dealer; securities of issuers that are part of the
Transferee's "family of investment companies," if the Transferee is a
registered investment company; bank deposit notes and certificates of
deposit; loan participations; repurchase agreements; securities owned but
subject to a repurchase agreement; and currency, interest rate and
commodity swaps;
(b) the aggregate value of the securities shall be the cost of such
securities, except where the entity 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 may be valued at market; and
(c) securities owned by subsidiaries of the entity that are
consolidated with the entity in its financial statements prepared in
accordance with generally accepted accounting principles may be included if
the investments of such subsidiaries are managed under the direction of the
entity, except that, unless the entity is a reporting company under Section
13 or 15(d) of the Securities Exchange Act of 1934, securities owned by
such subsidiaries may not be included if the entity itself is a
majority-owned subsidiary that would be included in the consolidated
financial statements of another enterprise.
5. Unless the Transferee is an "accredited investor" within the meaning of
Rule 501(a) (1), (2), (3), or (7) that is furnishing a Transferee Certificate in
the form of Exhibit B-3 to the Pooling and Servicing Agreement, the Transferor
or a person acting on its behalf has taken reasonable steps to ensure that the
Transferee is aware that the Transferor is relying on the exemption from the
provisions of Section 5 of the Securities Act provided by Rule 144A.
B-1-2
<PAGE>
6. The Transferor or a person acting on its behalf has furnished, or caused
to be furnished, to the Transferee all information regarding (a) the Certificate
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 Certificate, that the Transferee has
requested.
Very truly yours,
-----------------------------------
(Transferor)
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
B-1-3
<PAGE>
EXHIBIT B-2
FORM I OF TRANSFEREE CERTIFICATE
_______, 19__
LaSalle National Bank
135 South LaSalle Street
Suite 1625
Chicago, Illinois 60674-4107
Re: GMAC Commercial Mortgage Securities, Inc., Mortgage
Pass-Through Certificates, Series 1998-C1, Class [G] [H] [J]
[K] [L] [M] [N], having an initial principal balance as of
May 1, 1998 of $ ____________________
Dear Sirs:
This letter is delivered to you in connection with the transfer by (the
"Transferor") to _______________ (the "Transferee") of the captioned Certificate
(the "Certificate"), pursuant to Section 5.02 of the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of May 1, 1998,
among GMAC Commercial Mortgage Securities, Inc., as Depositor, GMAC Commercial
Mortgage Corporation, as Master Servicer and Special Servicer, LaSalle National
Bank, as Trustee and ABN AMRO Bank N.V., as Fiscal Agent. All terms used herein
and not otherwise defined shall have the respective meanings set forth in the
Pooling and Servicing Agreement. The Transferor 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 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 (a) 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 made in reliance on Rule 144A, or (b)
pursuant to another exemption from registration under the Securities Act.
2. The Transferee has been furnished with all information regarding (a) the
Certificate 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 Certificate, that it has
requested.
3. If the Transferee proposes that the Certificate be registered in the
name of a nominee, such nominee has completed the Nominee Acknowledgment below
<PAGE>
4. The Transferee hereby certifies to the Trustee, the Depositor and the
Master Servicer that (a) such transfer is permissible under applicable law, will
not constitute or result in any non-exempt prohibited transaction under Section
406 of ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee or the Master Servicer to any obligation in addition to those undertaken
in the Agreement and the Transferee has attached hereto an opinion of counsel to
such affect, or (b) such transfer will not constitute or result in any
non-exempt prohibited transaction under ERISA or Section 4975 of the Code, will
not subject the Depositor, the Trustee or the Master Servicer to any obligation
in addition to those undertaken in the Agreement, and the following conditions
are met: (i) the source of funds used to purchase the Certificate is an
"insurance company general account" (as such term is defined in United States
Department of Labor Prohibited Transaction Class Exemption ("PTCE 95-60") and
(ii) the conditions set forth in Sections I and III of PTCE 95-60 have been
satisfied as of the date of the acquisition of the Certificate.
Very truly yours,
-----------------------------------
(Transferee)
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
B-2-2
<PAGE>
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the Certificate
being registered in its name, the sole beneficial owner thereof is and shall be
______________, the Transferee identified above, for whom the undersigned is
acting as nominee.
-----------------------------------
(Nominee)
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
B-2-3
<PAGE>
ANNEX 1 TO EXHIBIT B-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 [name of Certificate Registrar], as Certificate Registrar,
with respect to the mortgage pass-through certificate (the "Certificate")
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 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 $_______________
1/ 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) and (ii) the Transferee satisfies the
criteria in the category marked below.
__ Corporation, etc. The Transferee is a corporation (other than a bank,
savings and loan association or similar institution), Massachusetts or
similar business trust, partnership, or any organization described in
Section 501(c)(3) of the Internal Revenue Code of 1986.
__ 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.
__ 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.
__ Broker-dealer. The Transferee is a dealer registered pursuant to Section
15 of the Securities Exchange Act of 1934.
__ 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.
- ----------
1/ 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.
B-2-4
<PAGE>
__ 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.
__ ERISA Plan. The Transferee is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security Act of 1974.
__ Investment Advisor. The Transferee is an investment advisor registered
under the Investment Advisers Act of 1940.
__ 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 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
participation, (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 Transferor and other parties related to the Certificate are
relying and will continue to rely on the statements made herein because one or
more sales to the Transferee may be in reliance on Rule 144A.
___ ___ Will the Transferee be purchasing the Certificate only
Yes No 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.
B-2-5
<PAGE>
7. The Transferee hereby certifies to the Trustee, the Depositor and the
Master Servicer that (a) such transfer is permissible under applicable law, will
not constitute or result in any non-exempt prohibited transaction under Section
406 of ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee or the Master Servicer to any obligation in addition to those undertaken
in the Agreement and the Transferee has attached hereto an opinion of counsel to
such affect, or (b) such transfer will not constitute or result in any
non-exempt prohibited transaction under ERISA or Section 4975 of the Code, will
not subject the Depositor, the Trustee or the Master Servicer to any obligation
in addition to those undertaken in the Agreement, and the following conditions
are met: (i) the source of funds used to purchase the Certificate is an
"insurance company general account" (as such term is defined in United States
Department of Labor Prohibited Transaction Class Exemption ("PTCE 95-60") and
(ii) the conditions set forth in Sections I and III of PTCE 95-60 have been
satisfied as of the date of the acquisition of the Certificate.
-----------------------------------
Print Name of Transferee
By:
--------------------------------
Name:
------------------------------
Title:
----------------------------
Date:
------------------------------
B-2-6
<PAGE>
ANNEX 2 TO EXHIBIT B-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 [name of Certificate Registrar], as Certificate Registrar,
with respect to the mortgage pass-through certificate (the "Certificate")
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 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.
__ The Transferee owned and/or invested on a discretionary basis
$___________ in securities (other than the excluded securities referred to
below) as of the end of the Transferee's most recent fiscal year (such
amount being calculated in accordance with Rule 144A).
__ The Transferee 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).
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 participation, (iv) repurchase agreements, (v) securities
owned but subject to a repurchase agreement and (vi) currency, interest rate and
commodity swaps. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Transferee, or owned by
the Transferee's Family of Investment Companies, the securities referred to in
this paragraph were excluded.
5. The Transferee is familiar with Rule 144A and understands that the
parties to which this certification is being made are relying and will continue
to rely on the statements made herein because one or more sales to the
Transferee will be in reliance on Rule 144A.
___ ___ Will the Transferee be purchasing the Certificate
Yes No only for the Transferee's own account?
B-2-7
<PAGE>
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 Certificate will constitute a
reaffirmation of this certification by the undersigned as of the date of such
purchase.
-----------------------------------
Print Name of Transferee or Adviser
By:
--------------------------------
Name:
------------------------------
Title:
----------------------------
Date:
-----------------------------
IF AN ADVISER:
-----------------------------------
Print Name of Transferee
Date:
------------------------------
B-2-8
<PAGE>
EXHIBIT B-3
FORM II OF TRANSFEREE CERTIFICATE
________, 19__
LaSalle National Bank
135 South LaSalle Street
Suite 1625
Chicago, Illinois 60674-4107
Re: GMAC Commercial Mortgage Securities, Inc., Mortgage Pass-Through
Certificates, Series 1998-C1, Class [G] [H] [J] [K] [L] [M] [N],
having an initial principal balance as of May 1, 1998 of $_______
Dear Sirs:
This letter is delivered to you in connection with the transfer by (the
"Transferor") to ____________ (the "Transferee") of the captioned Certificate
(the "Certificate"), pursuant to Section 5.02 of the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of May 1, 1998,
among GMAC Commercial Mortgage Securities, Inc., as Depositor, GMAC Commercial
Mortgage Corporation, as Master Servicer and Special Servicer, LaSalle National
Bank, as Trustee and ABN AMRO Bank N.V., as Fiscal Agent. All terms used herein
and not otherwise defined shall have the respective 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 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 Certificate has not been and
will not be registered under the Securities Act or registered or qualified under
any applicable state securities laws, (b) neither the Depositor nor the Trustee
is obligated so to register or qualify the Certificate and (c) neither the
Certificate nor any security issued in exchange therefor or in lieu thereof may
be resold or transferred unless it is (i) registered pursuant to the Securities
Act and registered or qualified pursuant to any applicable state securities laws
or (ii) sold or transferred in a transaction which is exempt from such
registration and qualification and the Certificate Registrar has received (A) a
certificate from the prospective transferor substantially in the form attached
as Exhibit B-1 to the Pooling and Servicing Agreement, and a certificate from
the prospective transferee substantially in the form attached either as Exhibit
B-2 or Exhibit B-3 to the Pooling and Servicing Agreement, or (B) an Opinion of
Counsel satisfactory to the Certificate Registrar that the transfer may be made
without registration under the Securities Act, together with the written
certification(s) as to the facts surrounding the transfer from the prospective
transferor and/or prospective transferee upon which such Opinion of Counsel is
based.
3. The Transferee understands that it may not sell or otherwise transfer
the Certificate, any security issued in exchange therefor or in lieu thereof or
any interest in the foregoing 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 Certificate will bear legends substantially to
the following effect:
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED OR QUALIFIED UNDER
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.
<PAGE>
- 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 SET FORTH IN THE POOLING AND
SERVICING AGREEMENT.
4. Neither the Transferee nor anyone acting on its behalf has (a) offered,
pledged, sold, disposed of or otherwise transferred the Certificate, any
interest in the 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 the Certificate, any interest in the Certificate or any other
similar security from any person in any manner, (c) otherwise approached or
negotiated with respect to the Certificate, any interest in the 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 the
Certificate under the Securities Act, would render the disposition of the
Certificate a violation of Section 5 of the Securities Act or any state
securities law or would require registration or qualification of the 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 the Certificate, any security issued in exchange therefor or in
lieu thereof or any interest in the foregoing.
5. The Transferee has been furnished with all information regarding (a) the
Depositor, (b) the Certificate and distributions thereon, (c) the Mortgage
Loans, (d) the Pooling and Servicing Agreement, and (e) all related matters,
that it has requested.
6. The Transferee is an "accredited investor" within the meaning of
paragraph (1), (2), (3) or (7) of Rule 501(a) under the Securities Act and has
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of an investment in the Certificates; the
Transferee has sought such accounting, legal and tax advice as it has considered
necessary to make an informed investment decision; and the Transferee is able to
bear the economic risks of such an investment and can afford a complete loss of
such investment.
7. The Transferee hereby certifies to the Trustee, the Depositor and the
Master Servicer that (a) such transfer is permissible under applicable law, will
not constitute or result in any non-exempt prohibited transaction under Section
406 of ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee or the Master Servicer to any obligation in addition to those undertaken
in the Agreement and the Transferee has attached hereto an opinion of counsel to
such affect, or (b) such transfer will not constitute or result in any
non-exempt prohibited transaction under ERISA or Section 4975 of the Code, will
not subject the Depositor, the Trustee or the Master Servicer to any obligation
in addition to those undertaken in the Agreement, and the following conditions
are met: (i) the source of funds used to purchase the Certificate is an
"insurance company general account" (as such term is defined in United States
Department of Labor Prohibited Transaction Class Exemption ("PTCE 95-60") and
(ii) the conditions set forth in Sections I and III of PTCE 95-60 have been
satisfied as of the date of the acquisition of the Certificate.
8. If the Transferee proposes that the Certificate be registered in the
name of a nominee, such nominee has completed the Nominee Acknowledgment below
Very truly yours,
----------------------
B-3-2
<PAGE>
(Transferee)
By:
--------------------------------
Name:
Title:
B-3-3
<PAGE>
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the Certificate
being registered in its name, the sole beneficial owner thereof is and shall be
__________, the Transferee identified above, for whom the undersigned is acting
as nominee.
-----------------------------------
(Nominee)
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
B-3-4
<PAGE>
EXHIBIT C-1
FORM OF TRANSFER AFFIDAVIT AND AGREEMENT
FOR TRANSFERS OF REMIC RESIDUAL CERTIFICATES
STATE OF )
) ss:
COUNTY OF )
_____________________, being first duly sworn, deposes and says that:
1. He/She is the ____________________ of ____________________ (the
prospective transferee (the "Transferee") of GMAC Commercial Mortgage
Securities, Inc., Mortgage Pass-Through Certificates, Series 1998-C1, Class
[R-I] [R-II] [R-III], evidencing a ____% Percentage Interest in such Class (the
"Residual Certificates"), a ________________ duly organized and validly existing
under the laws of _____________________, on behalf of which he/she makes this
affidavit. All capitalized terms used but not otherwise defined herein shall
have the respective meanings set forth in the Pooling and Servicing Agreement
pursuant to which the Residual Certificates were issued (the "Pooling and
Servicing Agreement").
2. The Transferee (i) is, and as of the date of transfer will be, a
"Permitted Transferee" and will endeavor to remain a "Permitted Transferee" for
so long as it holds the Residual Certificates, and (ii) is acquiring the
Residual Certificates for its own account or for the account of another
prospective transferee 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 possession of the United States. (For
this purpose, a "disqualified organization" means an electing large partnership
under section 775 of the Code, the United States, any state or political
subdivision thereof, any agency or instrumentality of any of the foregoing
(other than an instrumentality, all of the activities of which are subject to
tax and, except for the Federal Home Loan Mortgage Corporation, a majority of
whose board of directors is not selected by any such governmental entity) or any
foreign government, international organization or any agency or instrumentality
of such foreign government or organization, any rural electric or telephone
cooperative, or any organization (other than certain farmers' cooperatives) that
is generally exempt from federal income tax unless such organization is subject
to the tax on unrelated business taxable income.
3. The Transferee is aware (i) of the tax that would be imposed on
transfers of the Residual Certificates to "disqualified organizations" under the
Code that applies to all transfers of the Residual Certificates; (ii) that such
tax would be on the transferor (or, with respect to transfers to electing large
partnerships, on such partnership) or, if such transfer is through an agent
(which Person includes a broker, nominee or middleman) for a non-Permitted
Transferee, on the agent; (iii) that the Person (other than transfers with
respect to electing large partnerships) 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 a Permitted Transferee and, at the time of
transfer, such Person does not have actual knowledge that the affidavit is
false; and (iv) that the Residual Certificates may be a "noneconomic residual
interest" within the meaning of Treasury regulation Section 1.860E-1(c) 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. The Transferee is aware of the tax imposed on a "pass-through entity"
holding the Residual Certificates if at any time during the taxable year of the
pass-through entity a non-Permitted Transferee is the record holder of an
interest in such entity. (For this purpose, a "pass-through entity" includes a
regulated investment company, a real estate investment trust or common trust
fund, a partnership, trust or estate, and certain cooperatives.)
<PAGE>
5. The Transferee is aware that the Certificate Registrar will not register
any transfer of the Residual Certificates by the Transferee unless the
Transferee's transferee, or such transferee's agent, delivers to the Certificate
Registrar, among other things, an affidavit and agreement in substantially the
same form as this affidavit and agreement. The Transferee expressly agrees that
it will not consummate any such transfer if it knows or believes that any
representation contained in such affidavit and agreement is false.
6. The Transferee 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 Residual Certificate will only be owned, directly
or indirectly, by a Permitted Transferee.
7. The Transferee's taxpayer identification number is __________.
8. The Transferee has reviewed the provisions of Section 5.02(d) of the
Pooling and Servicing Agreement, a description of which provisions is set forth
in the Residual Certificates (in particular, clause (ii)(A) of Section 5.02(d)
which authorizes the Trustee to deliver payments on the Residual Certificate to
a Person other than the Transferee and clause (ii)(B) of Section 5.02(d) which
authorizes the Trustee to negotiate a mandatory sale of the Residual
Certificates, in either case, in the event that the Transferee holds such
Residual Certificates in violation of Section 5.02(d)); and the Transferee
expressly agrees to be bound by and to comply with such provisions.
9. No purpose of the Transferee relating to its purchase or any sale of the
Residual Certificates is or will be to impede the assessment or collection of
any tax.
10. The Transferee hereby represents to and for the benefit of the
transferor that the Transferee intends to pay any taxes associated with holding
the Residual Certificates as they become due, fully understanding that it may
incur tax liabilities in excess of any cash flows generated by the Residual
Certificates.
11. The Transferee will, in connection with any transfer that it makes of
the Residual Certificates, deliver to the Certificate Registrar a representation
letter substantially in the form of Exhibit H-2 to the Pooling and Servicing
Agreement in which it will represent and warrant, among other things, that it is
not transferring the Residual Certificates to impede the assessment or
collection of any tax and that it has at the time of such transfer conducted a
reasonable investigation of the financial condition of the proposed transferee
as contemplated by Treasury regulation Section 1.860E-1(c)(4)(i) and has
satisfied the requirements of such provision.
12. The Transferee is a citizen or resident of the United States, a
corporation, a partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof (except, in the
case of a partnership, to the extent provided in Treasury regulations such
partnership is not a U.S. person), or an estate or trust whose income from
sources without the United States is includible in gross income for United
States federal income tax purposes regardless of its connection with the conduct
of a trade or business within the United States.
13. The Transferee is not (A) an 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 Section 4975
of the Code (each, a "Plan") or (B) a Person who is directly or indirectly
purchasing the Class Residual Certificates or interest therein on behalf of, as
named fiduciary of, as trustee of, or with assets of a Plan, unless the
prospective transferee provides the Trustee, the Fiscal Agent, the Master
Servicer and the Depositor with a certification of facts and an Opinion of
Counsel which establish to the satisfaction of the Trustee, the Fiscal Agent,
the Master Servicer and the Depositor that such transfer is permissible under
applicable law, will not constitute or result in a violation of Section 406 of
ERISA or Section 4975 of the Code and will not subject the Depositor, the
Trustee, the Fiscal Agent or the Master Servicer to any obligation in addition
to those undertaken in the Pooling and Servicing Agreement.
C-1-2
<PAGE>
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to the authority of its Board of Directors, by
its _______ and its corporate seal to be hereunto attached, attested by its
[Assistant] Secretary, this ___ day of _______, ____.
[NAME OF TRANSFEREE]
By:
-------------------------------
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
- ------------------------------
[Assistant] Secretary
Personally appeared before me the above-named ___________________ known or
proved to me to be the same person who executed the foregoing instrument and to
be the of the Transferee, and acknowledged to me that he/she executed the same
as his/her free act and deed and the free act and deed of the Transferee
Subscribed and sworn before me this __ day of __________________.
-----------------------------------------------
NOTARY PUBLIC
COUNTY OF______________________________________
STATE OF_______________________________________
My Commission expires the __ day of ______, 19__.
C-1-3
<PAGE>
EXHIBIT C-2
FORM OF TRANSFEROR CERTIFICATE FOR TRANSFERS OF
REMIC RESIDUAL CERTIFICATES
_______________, 19__
LaSalle National Bank
135 South LaSalle Street
Suite 1625
Chicago, Illinois 60674-4107
Re: GMAC Commercial Mortgage Securities, Inc., Mortgage Pass-Through
Certificates, Series 1998-C1 (the "Certificates")
Dear Sirs:
This letter is delivered to you in connection with the transfer by
_________________ (the "Transferor") to ____________________ (the "Transferee")
of [Class R-I] [Class R-II] [Class R-III] Certificates evidencing a % Percentage
Interest in such Class (the "Residual Certificates"). The Certificates,
including the Residual Certificates, were issued pursuant to the Pooling and
Servicing Agreement, dated as of May 1, 1998 (the "Pooling and Servicing
Agreement"), among GMAC Commercial Mortgage Securities, Inc., as Depositor, GMAC
Commercial Mortgage Corporation, as Master Servicer and Special Servicer,
LaSalle National Bank, as Trustee and ABN AMRO Bank N.V., as Fiscal Agent. All
capitalized terms used but not otherwise defined herein shall have the
respective meanings set forth in the Pooling and Servicing Agreement. The
Transferor hereby certifies, represents and warrants to you, as Certificate
Registrar, that:
1. No purpose of the Transferor relating to the transfer of the Residual
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. 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 Residual 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.
<PAGE>
4. The Transferee has no actual knowledge that such prospective Transferee
is not a Permitted Transferee or is not a United States Person.
Very truly yours,
(Transferee)
By:
-------------------------
Name:
-------------------------
Title:
-------------------------
C-2-2
<PAGE>
EXHIBIT D
FORM OF REQUEST FOR RELEASE
DATE:
TO:
RE: REQUEST FOR RELEASE OF DOCUMENTS
In connection with the administration of the pool of Mortgage Loans held by you
for the referenced pool, we request the release of the Mortgage Loan File
described below.
Pooling and Servicing Agreement Dated:
Series#:
Account#:
Pool#:
Loan#:
Borrower Name(s):
Reason for Document Request: (indicate one)
[ ] Mortgage Loan Prepaid in Full
[ ] Mortgage Loan Repurchased or Sold
[ ] Other (specify)__________________
_____________________________________
_____________________________________
"We hereby certify that all amounts received or to be received in connection
with such payments which are required to be deposited have been or will be so
deposited as provided in the Pooling and Servicing Agreement."
[GMAC COMMERCIAL MORTGAGE CORPORATION]
Authorized Signature
********************************************************************
TO CUSTODIAN/TRUSTEE: Please acknowledge this request, and check off documents
being enclosed with a copy of this form. You should retain this form for your
files in accordance with the terms of the Pooling and Servicing Agreement.
Enclosed Documents: [ ] Promissory Note
[ ] Primary Insurance Policy
[ ] Mortgage or Deed of Trust
[ ] Assignment(s) of Mortgage or Deed of Trust
[ ] Title Insurance Policy
[ ] Other:
Name
Title
Date
<PAGE>
EXHIBIT E
FORM OF UCC-1
<PAGE>
SCHEDULE 1 TO UCC-1 FINANCING STATEMENT
All right (including the power to convey title thereto), title and interest of
the Debtor as more particularly described on Exhibit A attached hereto:
E-2
<PAGE>
EXHIBIT A OF SCHEDULE 1 TO UCC-1 FINANCING STATEMENT
All right (including the power to convey title thereto), title and interest
of the Debtor, including any security interest therein for the benefit of the
Debtor, in and to the Trust Fund created pursuant to the Pooling and Servicing
Agreement, dated as of May 1, 1998, among the Debtor as Depositor, the Secured
Party as Trustee*, ABN AMRO Bank N.V., as Fiscal Agent and GMAC Commercial
Mortgage Corporation as Master Servicer and Special Servicer with respect to
Mortgage Pass-Through Certificates, Series 1998-C1 (the "Pooling and Servicing
Agreement (Series 1998-C1), including:
(1) the Mortgage Loans listed on the Mortgage Loan Schedule attached
hereto;
(2) all principal and interest received or receivable with respect to the
Mortgage Loans (other than principal and interest payments due and payable prior
to the Cut-off Date and Principal Prepayments received prior to the Cut-off
Date);
(3) all amounts held from time to time in the Certificate Account and the
Distribution Account and all reinvestment earnings on such amounts;
(4) all of the Debtor's right, title and interest in and to the proceeds of
any title, hazard or other Insurance Policies related to such Mortgage Loans;
(5) any and all general intangibles (as defined in the Uniform Commercial
Code) consisting of, arising from or relating to any of the foregoing; and
(6) any and all income, payments, proceeds and products of any of the
foregoing.
Capitalized terms used herein, but not defined, shall have the respective
meanings assigned to such terms in the Pooling and Servicing Agreement (Series
1998-C1).
THE DEBTOR AND THE SECURED PARTY INTEND THE TRANSACTIONS CONTEMPLATED BY
THE POOLING AND SERVICING AGREEMENT TO CONSTITUTE A SALE OF THE INTEREST IN,
WITH RESPECT TO THE MORTGAGE LOANS, THE MORTGAGE NOTES, THE RELATED MORTGAGES
AND THE RELATED MORTGAGE FILES, AND THIS FILING SHOULD NOT BE CONSTRUED AS A
CONCLUSION THAT A SALE HAS NOT OCCURRED. THE REFERENCES HEREIN TO MORTGAGE NOTES
SHOULD NOT BE CONSTRUED AS A CONCLUSION THAT ANY MORTGAGE NOTE IS NOT AN
INSTRUMENT WITHIN THE MEANING OF THE UNIFORM COMMERCIAL CODE, AS IN EFFECT IN
ANY APPLICABLE JURISDICTION, OR THAT A FILING IS NECESSARY TO PERFECT THE
SECURITY INTEREST OF THE SECURED PARTY*, WITH RESPECT TO THE MORTGAGE LOANS, IN
ANY MORTGAGE NOTE, MORTGAGE OR DOCUMENT IN A MORTGAGE FILE. WITH RESPECT TO THE
FOREGOING, THIS FILING IS MADE ONLY IN THE EVENT OF CONTRARY ASSERTIONS BY THIRD
PARTIES.
*Not in its individual capacity, but solely as Trustee for the benefit of
the Certificateholders pursuant to the Pooling and Servicing Agreement (Series
1998-C1).
E-3
<PAGE>
MORTGAGE LOAN SCHEDULE TO UCC-1 FINANCING STATEMENT
E-4
<PAGE>
EXHIBIT F
Methodology to Normalize Net Operating Income and Debt Service Coverage
o GMAC Commercial Mortgage Corporation ("GMACCM") applies the methodology
presented below to arrive at a servicer adjusted or "Normalized" Net
Operating Income ("NOI"). The items described below highlight some of the
major categories requiring adjustment. There may, however, be others, and
GMACCM will use its market knowledge and discretion in making and
sufficiently footnoting the necessary adjustments.
o GMACCM chooses to use the actual management fee stated in the financial
statement.
o Where they are clearly identifiable, GMACCM will remove any capital expense
from any above the line categories (such as extraordinary repairs and
maintenance) and put them below the line in the capital expense comment
section.
o Replacement reserves, tenant improvement and leasing commission reserves
will be treated as above the line expenses. A determination will be made
whether there have been credits for the disbursements from a reserve and
that expenses are not overstated due to exclusion of credits.
o Property taxes should be the annual amount due, excluding any delinquent
taxes or credits from prior years which would cause the number to be higher
or lower. The amount for property taxes will be adjusted if the period
under analysis is less than one year.
o GMAC Commercial Mortgage will exclude non-recurring, extraordinary income.
For example, a tax refund, lease buyout or income received for a period
other than the year in question should be adjusted. If past due rent for a
prior year was paid and recorded in the current year, GMACCM would back it
out and footnote it accordingly. Care will be used when reflecting
percentage/overage rents to ensure that it relates to the appropriate
period and that the numbers are supported by tenant sales information.
o GMAC Commercial Mortgage will remove any items not pertaining to the
operation of the property such as, fees for closing the loan restructure, a
distribution to owners or a charitable contribution.
o When necessary, income and expenses will be analyzed by looking at
variances by category. Unusual income and expense items will be researched.
If there are significant variances, inquiries to the borrower will be made.
Appropriate adjustments will be made and footnotes provided to clearly
explain the situation.
o The debt service should be an actual amount the borrower paid per the
servicing records for the period associated with the operating statement.
If GMACCM does not have a full year of payments, it will use the principal
and interest constant in the case of a fixed rate loan and, in the case of
an adjustable rate loan, will estimate a full year amount from the payment
history information available.
<PAGE>
EXHIBIT G
Form of Distribution Date Statement
<PAGE>
EXHIBIT H
Form of Master Servicer Report
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EXHIBIT I
Certain Reports
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Schedule I
Mortgage Loan Schedule
Schedule I-1
EXHIBIT 99.1
EXECUTION COPY
MORTGAGE LOAN PURCHASE AGREEMENT
This Mortgage Loan Purchase Agreement (this "Agreement"), is dated and
effective as of April 28, 1998, between GMAC Commercial Mortgage Corporation as
seller (the "Seller") and GMAC Commercial Mortgage Securities, Inc. as purchaser
(the "Purchaser").
The Seller desires to sell, assign, transfer and otherwise convey to the
Purchaser, and the Purchaser desires to purchase, subject to the terms and
conditions set forth below, the multifamily and commercial mortgage loans (the
"Mortgage Loans") identified on the schedule annexed hereto as Exhibit A (the
"Mortgage Loan Schedule").
It is expected that the Mortgage Loans will be transferred, together with
other multifamily and commercial mortgage loans to a trust fund (the "Trust
Fund") to be formed by the Purchaser, beneficial ownership of which will be
evidenced by a series of mortgage pass-through certificates (the
"Certificates"). Certain classes of the Certificates will be rated by Moody's
Investors Service, Inc. and FITCH IBCA, Inc. (together, the "Rating Agencies").
Certain classes of the Certificates (the "Registered Certificates") will be
registered under the Securities Act of 1933, as amended (the "Securities Act").
The Trust Fund will be created and the Certificates will be issued pursuant to a
pooling and servicing agreement to be dated as of May 1, 1998 (the "Pooling and
Servicing Agreement"), among the Purchaser as depositor, GMAC Commercial
Mortgage Corporation as master servicer (in such capacity, the "Master
Servicer") and special servicer (in such capacity, the "Special Servicer"),
LaSalle National Bank as trustee (in such capacity, the "Trustee") and ABN AMRO
Bank N.V. as fiscal agent. Capitalized terms not otherwise defined herein have
the meanings assigned to them in the Pooling and Servicing Agreement.
The Purchaser intends to sell certain of the Certificates to Deutsche
Morgan Grenfell Inc., Lehman Brothers Inc. and Residential Funding Securities
Corp. (together, the "Underwriters") pursuant to an underwriting agreement dated
the date hereof (the "Underwriting Agreement"). The Purchaser intends to sell
the remaining Certificates (the "Non-Registered Certificates") to Deutsche
Morgan Grenfell Inc. and Lehman Brothers Inc. (the "Initial Purchasers"),
pursuant to a certificate purchase agreement dated the date hereof (the
"Certificate Purchase Agreement").
Now, therefore, in consideration of the premises and the mutual agreements
set forth herein, the parties agree as follows:
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SECTION 1. Agreement to Purchase.
The Seller agrees to sell, assign, transfer and otherwise convey to the
Purchaser, and the Purchaser agrees to purchase, the Mortgage Loans. The
purchase and sale of the Mortgage Loans shall take place on May 18, 1998 or such
other date as shall be mutually acceptable to the parties hereto (the "Closing
Date"). As of the close of business on May 1, 1998 (the "Cut-off Date"), the
Mortgage Loans will have an aggregate principal balance (the "Aggregate Cut-off
Date Balance"), after application of all payments of principal due thereon on or
before such date, whether or not received, of $1,198,282,763, subject to a
variance of plus or minus 5%. The purchase price for the Mortgage Loans shall be
determined and paid to the Seller in accordance with the terms of an allocation
agreement dated the date hereof (the "Allocation Agreement"), to which the
Seller and Purchaser, among others, are parties.
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt by the Seller
of the purchase price referred to in Section 1 hereof (exclusive of any
applicable holdback for transaction expenses in accordance with the Allocation
Agreement), 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 Mortgage Loans identified on the Mortgage
Loan Schedule as of such date, including all interest and principal received or
receivable by the Seller on or with respect to the Mortgage Loans after the
Cut-off Date, together with all of the Seller's right, title and interest in and
to the proceeds of any related title, hazard, or other insurance policies and
any escrow, reserve or other comparable accounts related to the Mortgage Loans.
The Purchaser shall be entitled to (and, to the extent received by or on behalf
of the Seller, the Seller shall deliver or cause to be delivered to or at the
direction of the Purchaser) all scheduled payments of principal and interest due
on the Mortgage Loans after the Cut-off Date, and all other recoveries of
principal and interest collected thereon after the Cut-off Date. All scheduled
payments of principal and interest due thereon on or before the Cut-off Date and
collected after the Cut-off Date shall belong to the Seller.
(b) In connection with the Seller's assignment pursuant to subsection (a)
above, the Seller hereby agrees that, at least five (5) Business Days before the
Closing Date, it shall have delivered to and deposited with the Trustee, the
Mortgage File (as described on Exhibit B hereto) for each Mortgage Loan so
assigned. It is further acknowledged and agreed by the Seller that the Purchaser
intends to cause the Trustee to perform a limited review of such Mortgage Files
to enable the Trustee to confirm to the Purchaser on or before the Closing Date
that the Mortgage Note referred to in clause (i) of Exhibit B has been delivered
by the Seller with respect to each such Mortgage File. In the event Seller fails
to so deliver each such Mortgage File to the Trustee, the Purchaser and its
successors and assigns shall be entitled to pursue any rights or remedies in
respect of such failure as may be available under applicable law. If the Seller
cannot deliver, or cause to be delivered, as to any Mortgage Loan, the original
or a copy of any of the documents and/or instruments referred to in clauses
(ii), (iv), (viii), (xi)(A) and (xii) of Exhibit B, with evidence of recording
thereon, solely because of a delay caused by the public recording or filing
office where such document or instrument has been delivered for recordation or
filing, or because such original recorded document has been lost or returned
from the recording or filing office and subsequently lost, as the case may be,
the delivery requirements of this Section 2(b) shall be deemed to have been
satisfied as to such missing item, and such missing item shall be deemed to have
been
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included in the related Mortgage File, provided that a copy of such document or
instrument (without evidence of recording or filing thereon, but certified
(which certificate may relate to multiple documents and/or instruments) by the
Seller to be a true and complete copy of the original thereof submitted for
recording or filing, as the case may be) has been delivered to the Trustee, and
either the original of such missing document or instrument, or a copy thereof,
with evidence of recording or filing, as the case may be, thereon, is delivered
to or at the direction of the Purchaser (or any subsequent owner of the affected
Mortgage Loan, including without limitation the Trustee) within 180 days of the
Closing Date (or within such longer period after the Closing Date as the
Purchaser (or such subsequent owner) may consent to, which consent shall not be
unreasonably withheld so long as the Seller has provided the Purchaser (or such
subsequent owner) with evidence of such recording or filing, as the case may be,
or has certified to the Purchaser (or such subsequent owner) as to the
occurrence of such recording or filing, as the case may be, and is, as certified
to the Purchaser (or such subsequent owner) no less often than quarterly, in
good faith attempting to obtain from the appropriate county recorder's or filing
office such original or copy). If the Seller cannot deliver, or cause to be
delivered, as to any Mortgage Loan, the original or a copy of the related
lender's title insurance policy referred to in clause (ix) of Exhibit B solely
because such policy has not yet been issued, the delivery requirements of this
Section 2(b) shall be deemed to be satisfied as to such missing item, and such
missing item shall be deemed to have been included in the related Mortgage File,
provided that the Seller has delivered to the Trustee a commitment for title
insurance "marked-up" at the closing of such Mortgage Loan, and the Seller shall
deliver to or at the direction of the Purchaser (or any subsequent owner of the
affected Mortgage Loan, including without limitation the Trustee), promptly
following the receipt thereof, the original related lender's title insurance
policy (or a copy thereof). In addition, notwithstanding anything to the
contrary contained herein, if there exists with respect to any group of related
cross-collateralized Mortgage Loans only one original of any document referred
to in Exhibit B covering all the Mortgage Loans in such group, then the
inclusion of the original of such document in the Mortgage File for any of the
Mortgage Loans in such group shall be deemed an inclusion of such original in
the Mortgage File for each such Mortgage Loan. On the Closing Date, upon
notification from the Seller that the purchase price referred to in Section 1
(exclusive of any applicable holdback for transaction expenses in accordance
with the Allocation Agreement) has been received by the Seller, the Trustee
shall be authorized to release to the Purchaser or its designee all of the
Mortgage Files in the Trustee's possession relating to the Mortgage Loans.
(c) As to each Mortgage Loan, the Seller shall be responsible for all costs
associated with the recording or filing, as the case may be, of each assignment
referred to in clauses (iii) and (v) of Exhibit B and each UCC-2 and UCC-3, if
any, referred to in clause (xi)(B) of Exhibit B; provided that the Seller shall
not be responsible for actually recording or filing any such document or
instrument. If any such document or instrument is lost or returned unrecorded or
unfiled, as the case may be, because of a defect therein, the Seller shall
promptly prepare or cause the preparation of a substitute therefor or cure or
cause the curing of such defect, as the case may be, and shall thereafter
deliver the substitute or corrected document to or at the direction of the
Purchaser (or any subsequent owner of the affected Mortgage Loan, including
without limitation the Trustee) for recording or filing, as appropriate, at the
Seller's expense.
(d) All documents and records in the Seller's possession (or under its
control) relating to the Mortgage Loans that are not required to be a part of a
Mortgage File in accordance with Exhibit B (all such other documents and
records, as to any Mortgage Loan, the "Servicing File"), together with all
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escrow payments, reserve funds and other comparable funds in the possession of
the Seller (or under its control) with respect to the Mortgage Loans, shall
(unless they are held by a sub-servicer that shall, as of the Closing Date,
begin acting on behalf of the Master Servicer pursuant to a written agreement
between such parties) be delivered by the Seller (or its agent) to the Purchaser
(or its designee) no later than the Closing Date. If a sub-servicer shall, as of
the Closing Date, begin acting on behalf of the Master Servicer with respect to
any Mortgage Loan pursuant to a written agreement between such parties, the
Seller shall deliver a copy of the related Servicing File to the Master
Servicer.
(e) The Seller's records will reflect the transfer of the Mortgage Loans to
the Purchaser as a sale.
SECTION 3. Examination of Mortgage Loan Files and Due Diligence Review.
The Seller shall reasonably cooperate with any examination of the Mortgage
Files and Servicing Files that may be undertaken by or on behalf of the
Purchaser. The fact that the Purchaser has conducted or has failed to conduct
any partial or complete examination of the Mortgage Files and/or Servicing Files
shall not affect the Purchaser's right to pursue any remedy available in equity
or at law for a breach of the Seller's representations, warranties and covenants
set forth in or contemplated by Section 4.
SECTION 4. Representations, Warranties and Covenants of the Seller.
(a) The Seller hereby makes, as of the Closing Date (or as of such other
date specifically provided in the particular representation or warranty), to and
for the benefit of the Purchaser, and its successors and assigns (including,
without limitation, the Trustee and the holders of the Certificates), each of
the representations and warranties set forth in Exhibit C, with such changes or
modifications as may be permitted or required by the Rating Agencies.
(b) In addition, the Seller, as of the date hereof, hereby represents and
warrants to, and covenants with, the Purchaser that:
(i) The Seller is a corporation, duly organized, validly existing and
in good standing under the laws of the State of California, and is in
compliance with the laws of each State in which any Mortgaged Property is
located to the extent necessary to ensure the enforceability of each
Mortgage Loan and to perform its obligations under this Agreement.
(ii) The execution and delivery of this Agreement by the Seller, and
the performance and compliance with the terms of this Agreement by the
Seller, will not violate the Seller'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 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, in each case which materially and
adversely affect the ability of the Seller to carry out the transactions
contemplated by this Agreement.
(iii) The Seller 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.
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(iv) This Agreement, assuming due authorization, execution and
delivery by the Purchaser, constitutes a valid, legal and binding
obligation of the Seller, enforceable against the Seller in accordance with
the terms hereof, subject to (A) applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally, (B) general principles of equity, regardless
of whether such enforcement is considered in a proceeding in equity or at
law, and (C) public policy considerations underlying the securities laws,
to the extent that such public policy considerations limit the
enforceability of the provisions of this Agreement that purport to provide
indemnification for securities laws liabilities.
(v) The Seller 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 Seller's good faith and reasonable judgment, is likely to affect
materially and adversely either the ability of the Seller to perform its
obligations under this Agreement or the financial condition of the Seller.
(vi) No litigation is pending with regard to which Seller has received
service of process or, to the best of the Seller's knowledge, threatened
against the Seller the outcome of which, in the Seller's good faith and
reasonable judgment, could reasonably be expected to prohibit the Seller
from entering into this Agreement or materially and adversely affect the
ability of the Seller to perform its obligations under this Agreement.
(vii) The Seller has not dealt with any broker, investment banker,
agent or other person, other than the Purchaser, the Underwriters, the
Initial Purchasers and their respective affiliates, that may be entitled to
any commission or compensation in connection with the sale of the Mortgage
Loans or the consummation of any of the other transactions contemplated
hereby.
(viii) Neither the Seller 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 to 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 with respect to any
Certificate, any interest in any Certificate or any similar security, or
(E) taken any other action, that (in the case of any of the acts described
in clauses (A) through (E) above) would constitute or result in a violation
of the Securities Act or any state securities law relating to or in
connection with the issuance of the Certificates or require registration or
qualification pursuant to the Securities Act or any state securities law of
any Certificate not otherwise intended to be a Registered Certificate. In
addition, the Seller 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 of the Certificates or interests therein. For
purposes of this paragraph 4(b)(viii), the term "similar security" shall be
deemed to include, without limitation,
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any security evidencing or, upon issuance, that would have evidenced an
interest in the Mortgage Loans or any substantial number thereof.
(ix) Insofar as it relates to the Mortgage Loans, the information set
forth on pages A-9 through A-13, inclusive, of Annex A to the Prospectus
Supplement (as defined in Section 9) (the "Loan Detail") and, to the extent
consistent therewith, the information set forth on the diskette attached to
the Prospectus Supplement and the accompanying prospectus (the "Diskette"),
is true and correct in all material respects. Insofar as it relates to the
Mortgage Loans and/or the Seller and does not represent a restatement or
aggregation of the information on the Loan Detail, the information set
forth in the Prospectus Supplement and the Memorandum (also as defined in
Section 9) under the headings "Summary of the Prospectus Supplement--The
Mortgage Asset Pool", "Risk Factors--The Mortgage Loans" and "Description
of the Mortgage Asset Pool", set forth on Annex A to the Prospectus
Supplement and (to the extent it contains information consistent with that
on such Annex A) set forth on the Diskette, does not contain any untrue
statement of a material fact or (in the case of the Memorandum, when read
together with the other information specified therein as being available
for review by investors) omit to state any material fact necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.
(x) 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 (including, with respect to any bulk sale laws),
for the execution, delivery and performance of or compliance by the Seller
with this Agreement, or the consummation by the Seller of any transaction
contemplated hereby, other than (1) the filing or recording of financing
statements, instruments of assignment and other similar documents necessary
in connection with Seller's sale of the Mortgage Loans to the Purchaser,
(2) such consents, approvals, authorizations, qualifications,
registrations, filings or notices as have been obtained or made and (3)
where the lack of such consent, approval, authorization, qualification,
registration, filing or notice would not have a material adverse effect on
the performance by the Seller under this Agreement.
(c) Upon discovery by any of the parties hereto of a breach of any of the
representations and warranties made pursuant to and set forth in subsection (b)
above which materially and adversely affects the interests of the Purchaser or a
breach of any of the representations and warranties made pursuant to subsection
(a) above and set forth in Exhibit C which materially and adversely affects the
value of any Mortgage Loan or the interests therein of the Purchaser or its
successors and assigns (including, without limitation the Trustee and the
holders of the Certificates), the party discovering such breach shall give
prompt written notice to the other party hereto.
SECTION 5. Representations, Warranties and Covenants of the Purchaser.
(a) The Purchaser, as of the date hereof, hereby represents and warrants
to, and covenants with, the Seller that:
(i) The Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of State of Delaware.
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(ii) The execution and delivery of this Agreement by the Purchaser,
and the performance and compliance with the terms of this Agreement by the
Purchaser, will not violate the Purchaser'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 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 Purchaser 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 the Seller, constitutes a valid, legal and binding obligation
of the Purchaser, enforceable against the Purchaser 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 Purchaser 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 Purchaser's good faith and reasonable judgment, is likely
to affect materially and adversely either the ability of the Purchaser to
perform its obligations under this Agreement or the financial condition of
the Purchaser.
(vi) No litigation is pending or, to the best of the Purchaser's
knowledge, threatened against the Purchaser which would prohibit the
Purchaser from entering into this Agreement or, in the Purchaser's good
faith and reasonable judgment, is likely to materially and adversely affect
either the ability of the Purchaser to perform its obligations under this
Agreement or the financial condition of the Purchaser.
(vii) The Purchaser has not dealt with any broker, investment banker,
agent or other person, other than the Seller, the Underwriters, the Initial
Purchasers and their respective affiliates, that may be entitled to any
commission or compensation in connection with the sale of the Mortgage
Loans or the consummation of any of the transactions contemplated hereby.
(viii) 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 of or compliance by the Purchaser with this Agreement, or the
consummation by the Purchaser of any transaction contemplated hereby, other
than (1) such consents, approvals, authorizations, qualifications,
registrations, filings or notices as have been obtained or made and (2)
where the lack of such consent, approval, authorization, qualification,
registration, filing or notice would not have a material adverse effect on
the performance by the Purchaser under this Agreement.
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(b) Upon discovery by any of the parties hereto of a breach of any of the
representations and warranties set forth above which materially and adversely
affects the interests of the Seller, the party discovering such breach shall
give prompt written notice to the other party hereto.
SECTION 6. Repurchases.
(a) Within 90 days of the earlier of discovery or receipt of notice by the
Seller, from either the Purchaser or any successor or assign thereof, of a
Defect (as defined in the Pooling and Servicing Agreement) in respect of the
Mortgage File for any Mortgage Loan or a breach of any representation or
warranty made pursuant to Section 4(a) and set forth in Exhibit C, which Defect
or breach, as the case may be, materially and adversely affects the value of any
Mortgage Loan or the interests therein of the Purchaser or its successors and
assigns (including, without limitation, the Trustee and the holders of the
Certificates), the Seller shall cure such Defect or breach, as the case may be,
in all material respects or repurchase the affected Mortgage Loan from the then
owner(s) thereof at the applicable Purchase Price (as defined in the Pooling and
Servicing Agreement) by payment of such Purchase Price by wire transfer of
immediately available funds to the account designated by such owner(s);
provided, however, that in lieu of effecting any such repurchase, the Seller
will be permitted to deliver a Qualifying Substitute Mortgage Loan and to pay a
cash amount equal to the applicable Substitution Shortfall Amount, subject to
the terms and conditions of the Pooling and Servicing Agreement.
If the Seller is notified of a defect in any Mortgage File that corresponds
to information set forth in the Mortgage Loan Schedule, the Seller shall
promptly correct such defect and provide a new, corrected Mortgage Loan Schedule
to the Purchaser, which corrected Mortgage Loan Schedule shall be deemed to
amend and replace the existing Mortgage Loan Schedule for all purposes.
(b) Notwithstanding Section 6(a), within 60 days of the earlier of
discovery or receipt of notice by the Seller, from either the Purchaser or any
successor or assign thereof, that any Mortgage Loan does not constitute a
"qualified mortgage" within the meaning of Section 860G(a)(3) of the Code, the
Seller shall repurchase such Mortgage Loan from the then owner(s) thereof at the
applicable Purchase Price by payment of such Purchase Price by wire transfer of
immediately available funds to the account designated by such owner(s).
In addition, if, as of the Closing Date, any Mortgage Loan is secured by a
Mortgage that does not constitute a valid first lien upon the related Mortgaged
Property, including all buildings located thereon and all fixtures attached
thereto, or if a Mortgage is subject to something other than (A) the lien of
current real property taxes and assessments not yet due and payable, (B)
covenants, conditions and restrictions, rights of way, easements and other
matters of public record, (C) exceptions and exclusions specifically referred to
in the lender's title insurance policy issued or, as evidenced by a "marked-up"
commitment, to be issued in respect of such Mortgage Loan and (D) those
exceptions set forth on Schedule C-1 to Exhibit C hereto (the exceptions set
forth in the foregoing clauses (A), (B), (C) and (D) collectively, "Permitted
Encumbrances"), or if the insurer that issued the Title Policy referred to in
clause (vi) of Exhibit C hereto in respect of any Mortgage Loan was not
qualified to do business in the state in which the related Mortgaged Property is
located, and in either case such failure materially and adversely affects the
interests of holder of Certificates, (any such failure that materially and
adversely affects the interests of holders of Certificates, also a "Material
Breach"), the Seller shall be required, at its option, to either (i) cure such
Material Breach in all material respects or (ii) repurchase the affected
Mortgage Loan, in each case, within the applicable Permitted Cure Period. If any
such Material Breach
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is not corrected or cured in all material respects within the applicable
Permitted Cure Period, the Seller shall, not later than the last day of such
Permitted Cure Period, (i) repurchase the affected Mortgage Loan from the
Purchaser or its assignee at the applicable Purchase Price or (ii) if within the
three-month period commencing on the closing date (or within the two-year period
commencing on the Closing Date if the related Mortgage Loan is a "defective
obligation" within the meaning of Section 860(a)(4)(B)(ii) of the Code and
Treasury Regulation Section 1.860G-2(f)), at its option, replace such Mortgage
Loan with a Qualifying Substitute Mortgage Loan and pay any corresponding
Substitution Shortfall Amount. The Seller agrees that any such repurchase or
substitution shall be completed in accordance with and subject to the terms and
conditions of the Pooling and Servicing Agreement.
For purposes of the foregoing, and subject to the following paragraph, the
"Permitted Cure Period" applicable to any Defect or Material Breach in respect
of any Mortgage Loan shall be the 90-day period immediately following the
earlier of the discovery by the Seller or receipt by the Seller of notice of
such Defect or Material Breach, as the case may be; provided that if such Defect
or Material Breach, as the case may be, cannot be corrected or cured in all
material respects within such 90-day period, but is reasonably likely that such
Defect or Material Breach, as the case may be, could be corrected or cured
within 180 days of the earlier of discovery by the Seller and receipt by the
Seller of notice of such Material Documents Defect or Material Breach, as the
case may be, and the Seller is diligently attempting to effect such correction
or cure, then the applicable Permitted Cure Period shall, with the consent of
the Purchaser or its assignee (which consent shall not be unreasonably
withheld), be extended for an additional 90 days.
(c) In connection with any repurchase of or substitution for a Mortgage
Loan contemplated by this Section 6, the then owner(s) thereof shall tender or
cause to be tendered promptly to the Seller, upon delivery of a receipt executed
by the Seller, the related Mortgage File and Servicing File, and each document
that constitutes a part of the Mortgage File that was endorsed or assigned to
the Purchaser or the Trustee shall be endorsed or assigned, as the case may be,
to the Seller in the same manner. The form and sufficiency of all such
instruments and certificates shall be the responsibility of the Seller.
(d) Except as provided in Section 2(b), this Section 6 provides the sole
remedies available to the Purchaser, and its successors and assigns (including,
without limitation, the Trustee and the holders of the Certificates) respecting
any Defect in a Mortgage File or any breach of any representation or warranty
made pursuant to Section 4(a) and set forth in Exhibit C, or in connection with
the circumstances described in Section 6(b). If the Seller defaults on its
obligations to repurchase any Mortgage Loan in accordance with Section 6(a) or
6(b) or disputes its obligation to repurchase any Mortgage Loan in accordance
with either such subsection, the Purchaser or its successors and assigns may
take such action as is appropriate to enforce such payment or performance,
including, without limitation, the institution and prosecution of appropriate
proceedings. The Seller shall reimburse the Purchaser for all necessary and
reasonable costs and expenses incurred in connection with such enforcement.
SECTION 7. Closing.
The closing of the sale of the Mortgage Loans (the "Closing") shall be held
at the offices of Orrick, Herrington & Sutcliffe LLP, 666 Fifth Avenue, New
York, New York 10103 at 10:00 a.m., New York City time, on the Closing Date.
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The Closing shall be subject to each of the following conditions:
(i) All of the representations and warranties of the Seller specified
herein shall be true and correct as of the Closing Date, and the Aggregate
Cut-off Date Balance shall be within the range permitted by Section 1 of
this Agreement;
(ii) All documents specified in Section 8 (the "Closing Documents"),
in such forms as are agreed upon and acceptable to the Purchaser, shall be
duly executed and delivered by all signatories as required pursuant to the
respective terms thereof;
(iii) The Seller shall have delivered and released to the Trustee, the
Purchaser or the Purchaser's designee, as the case may be, all documents
and funds required to be so delivered pursuant to Section 2;
(iv) The result of any examination of the Mortgage Files and Servicing
Files performed by or on behalf of the Purchaser pursuant to Section 3
shall be satisfactory to the Purchaser in its sole determination;
(v) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with,
and the Seller shall have the ability to comply with all terms and
conditions and perform all duties and obligations required to be complied
with or performed after the Closing Date;
(vi) The Seller shall have paid or agreed to pay all fees, costs and
expenses payable by it to the Purchaser pursuant to this Agreement; and
(vii) Neither the Underwriting Agreement nor the Certificate Purchase
Agreement shall have been terminated in accordance with its terms.
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
Mortgage Loans on the Closing Date.
SECTION 8. Closing Documents.
The Closing Documents shall consist of the following:
(a) This Agreement duly executed and delivered by the Purchaser and the
Seller;
(b) An Officer's Certificate substantially in the form of Exhibit D-1
hereto, executed by the Secretary or an assistant secretary of the Seller, and
dated the Closing Date, and upon which the Purchaser and each Underwriter may
rely, attaching thereto as exhibits the organizational documents of the Seller;
(c) A certificate of good standing regarding the Seller from the Secretary
of State for the State of California, dated not earlier than 30 days prior to
the Closing Date;
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(d) A certificate of the Seller substantially in the form of Exhibit D-2
hereto, executed by an executive officer or authorized signatory of the Seller
and dated the Closing Date, and upon which the Purchaser and each Underwriter
may rely;
(e) Written opinions of counsel for the Seller, substantially in the form
of Exhibits D-3A and D-3B hereto and subject to such reasonable assumptions and
qualifications as may be requested by counsel for the Seller and acceptable to
counsel for the Purchaser, dated the Closing Date and addressed to the Purchaser
and each Underwriter;
(f) Any other opinions of counsel for the Seller reasonably requested by
the Rating Agencies in connection with the issuance of the Certificates, each of
which shall include the Purchaser and each Underwriter as an addressee; and
(g) Such further certificates, opinions and documents as the Purchaser may
reasonably request.
SECTION 9. Indemnification.
(a) The Seller agrees to indemnify and hold harmless the Purchaser, its
officers and directors, and each person, if any, who controls the Purchaser
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Securities Exchange Act of 1934, as amended (the "Exchange 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 Securities Act, the Exchange
Act or other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in 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 thereof or supplement thereto, or arise out of or are
based upon the omission or alleged omission (in the case of any such
Computational Materials or ABS Term Sheets, when read in conjunction with the
Prospectus and, in the case of the Memorandum, when read together with the other
information specified therein as being available for review by investors) to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in 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 is with respect to information regarding
the Mortgage Loans contained in the Loan Detail or, to the extent consistent
therewith, the Diskette, or (ii) any such untrue statement or alleged untrue
statement or omission or alleged omission is with respect to information
regarding the Seller or the Mortgage Loans contained in the Prospectus
Supplement or the Memorandum under the headings "Summary of Prospectus
Supplement - The Mortgage Asset Pool", "Risk Factors - The Mortgage Loans"
and/or "Description of the Mortgage Asset Pool" or contained on Annex A to the
Prospectus Supplement (exclusive of the Loan Detail), and such information does
not represent a restatement or aggregation of information contained in the Loan
Detail; or (iii) such untrue statement, alleged untrue statement, 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 4;
provided, that the indemnification provided by this Section 9 shall not apply to
the extent that such untrue statement of a material fact or omission of a
material fact necessary to make the statements made, in light of the
circumstances in which they were made, not misleading, was made as a result of
an error in the
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manipulation of, or calculations based upon, the Loan Detail. This indemnity
agreement will be in addition to any liability which the Seller may otherwise
have.
For purposes of the foregoing, "Registration Statement" shall mean the
registration statement No. 333-37717 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 December 17,
1997, as supplemented by the prospectus supplement dated April 28, 1998 (the
"Prospectus Supplement"), relating to the Registered Certificates; "Memorandum"
shall mean the private placement memorandum dated April 28, 1998, relating to
the Non-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"); and "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").
(b) Promptly after receipt by any person entitled to indemnification under
this Section 9 (each, 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 9, notify
the indemnifying party in writing of the commencement thereof; but the omission
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 9. In case
any such action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and to the extent that it may elect by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof, with counsel
satisfactory to such indemnified party; provided, however, that if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party or parties shall have reasonably
concluded that there may be legal defenses available to it or them and/or other
indemnified parties that are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election to assume the defense of such action and approval by the
indemnified party of counsel, which approval will not be unreasonably withheld,
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 indemnifying party,
representing all the indemnified parties under Section 9(a) who are parties to
such action), (ii) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of commencement of the action or
(iii) the indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party;
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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 9 is due in
accordance with its terms but is for any reason held by a court to be
unavailable to an indemnified party on grounds of policy or otherwise, 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 9(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 9(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 9 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 9, 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 Securities 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 9
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by any indemnified
party, and (iii) acceptance of and payment for any of the Certificates.
SECTION 10. Costs.
Costs relating to the transactions contemplated hereby shall be borne by
the respective parties hereto in accordance with the Allocation Agreement.
SECTION 11. Notices.
All demands, notices and communications hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered to or mailed, by
registered mail, postage prepaid, by overnight mail or courier service, or
transmitted by facsimile and confirmed by a similar mailed writing, if to the
Purchaser, addressed to GMAC Commercial Mortgage Securities, Inc. at 650 Dresher
Road, P.O. Box 1015, Horsham, Pennsylvania 19044-8015, Attention: Structured
Finance Manager, facsimile no. (215) 328-1775, with a copy to the General
Counsel, GMAC Commercial Mortgage Corporation,
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or such other address or facsimile number as may hereafter be furnished to the
Seller in writing by the Purchaser; and if to the Seller, addressed to GMAC
Commercial Mortgage Corporation, at 650 Dresher Road, P.O. Box 1015, Horsham,
Pennsylvania 19044-8015, Attention: Structured Finance Manager, facsimile no.
(215) 328-1775, with a copy to GMAC Commercial Mortgage Corporation, or to such
other address or facsimile number as the Seller may designate in writing to the
Purchaser.
SECTION 12. Third Party Beneficiaries.
Each of the officers, directors and controlling persons referred to in
Section 9 hereof is an intended third party beneficiary of the covenants and
indemnities of the Seller set forth in Section 9 of this Agreement. It is
acknowledged and agreed that such covenants and indemnities may be enforced by
or on behalf of any such person or entity against the Seller to the same extent
as if it was a party hereto.
SECTION 13. 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 Mortgage Loans by the Seller to the
Purchaser or its designee.
SECTION 14. 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 15. Counterparts.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute
one and the same instrument.
SECTION 16. 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 THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES
EXCEPT THAT THE PARTIES HERETO
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INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 17. 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 18. 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 or other entity resulting from any merger, conversion or
consolidation to which the Seller is a party, or any person succeeding to all or
substantially all of the business of the Seller, shall be the successor to the
Seller hereunder. The Purchaser has the right to assign its interest under this
Agreement, in whole or in part, as may be required to effect the purposes of the
Pooling and Servicing Agreement, and the assignee shall, to the extent of such
assignment, succeed to the rights and obligations hereunder of the Purchaser.
Subject to the foregoing, this Agreement shall bind and inure to the benefit of
and be enforceable by the Seller and the Purchaser, and their permitted
successors and assigns, and the indemnified parties referred to in Section 9.
SECTION 19. Amendments.
No term or provision of this Agreement may be amended, waived, modified or
in any way altered, unless such amendment, waiver, modification or alteration is
in writing and signed by a duly authorized officer of the party against whom
such amendment, waiver, modification or alteration is sought to be enforced. In
addition, this Agreement may not be changed in any manner which would have a
material adverse effect on any third party beneficiary under Section 12 hereof
without the prior consent of that person.
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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.
GMAC COMMERCIAL MORTGAGE CORPORATION
By: /s/ Elisa George
------------------------------------
Name: Elisa George
Title: Senior Vice President
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
By: /s/ Elisa George
------------------------------------
Name: Elisa George
Title: Vice President
<PAGE>
EXHIBIT A
MORTGAGE LOAN SCHEDULE
The Mortgage Loan Schedule shall set forth, among other things, the
following information with respect to each Mortgage Loan:
(i) the loan number;
(ii) the street address (including city, state and zip code) of
the related Mortgaged Property;
(iii) the Mortgage Rate in effect as of the Cut-off Date and
whether such Mortgage Loan is an ARM Loan or a Fixed-Rate
Loan;
(iv) the original principal balance;
(v) the Cut-off Date Balance;
(vi) the (A) remaining term to stated maturity, (B) with respect
to each ARD Loan, the Anticipated Repayment Date and (C)
Stated Maturity Date;
(vii) the Due Date;
(viii) the amount of the Monthly Payment due on the first Due Date
following the Cut-off Date;
(ix) in the case of an ARM Loan, the (A) Index, (B) Gross
Margin, (C) first Mortgage Rate adjustment date following
the Cut-off Date and the frequency of Mortgage Rate
adjustments, and (D) maximum and minimum lifetime Mortgage
Rate, if any;
(x) whether such Mortgage Loan is an ARD Loan or a Defeasance
Loan; and
(xi) the Master Servicing Fee Rate.
The Mortgage Loan Schedule shall also set forth the aggregate Cut-off Date
Balance for all of the Mortgage Loans. Such list may be in the form of more than
one list, collectively setting forth all of the information required.
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EXHIBIT B
THE MORTGAGE FILE
The "Mortgage File" for any Mortgage Loan shall (other than with respect to
the Mortgage Loan identified as "GMAC 1010" on the Mortgage Loan Schedule),
subject to Section 2(b), collectively consist of the following documents:
(i) the original Mortgage Note, endorsed by the most recent
endorsee prior to the Trustee or, if none, by the
originator, without recourse, either in blank or to the
order of the Trustee in the following form: "Pay to the
order of LaSalle National Bank, as trustee for the
registered holders of GMAC Commercial Mortgage Securities,
Inc., Mortgage Pass-Through Certificates, Series 1998-C1,
without recourse";
(ii) the original or a copy of the Mortgage and, if applicable,
the originals or copies of any intervening assignments
thereof showing a complete chain of assignment from the
originator of the Mortgage Loan to the most recent assignee
of record thereof prior to the Trustee, if any, in each
case with evidence of recording indicated thereon;
(iii) an original assignment of the Mortgage, in recordable form,
executed by the most recent assignee of record thereof
prior to the Trustee or, if none, by the originator, either
in blank or in favor of the Trustee (in such capacity);
(iv) the original or a copy of the related Assignment of Leases
(if such item is a document separate from the Mortgage)
and, if applicable, the originals or copies of any
intervening assignments thereof showing a complete chain of
assignment from the originator of the Mortgage Loan to the
most recent assignee of record thereof prior to the
Trustee, if any, in each case with evidence of recording
thereon;
(v) an original assignment of any related Assignment of Leases
(if such item is a document separate from the Mortgage), in
recordable form, executed by the most recent assignee of
record thereof prior to the Trustee or, if none, by the
originator, either in blank or in favor of the Trustee (in
such capacity), which assignment may be included as part of
the corresponding assignment of Mortgage referred to in
clause (iii) above;
(vi) an original or copy of any related security agreement (if
such item is a document separate from the Mortgage) and, if
applicable, the originals or copies of any intervening
assignments thereof showing a complete chain of assignment
from the originator of the Mortgage Loan to the most recent
assignee of record thereof prior to the Trustee, if any;
B-1
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(vii) an original assignment of any related security agreement
(if such item is a document separate from the Mortgage)
executed by the most recent assignee of record thereof
prior to the Trustee or, if none, by the originator, either
in blank or in favor of the Trustee (in such capacity),
which assignment may be included as part of the
corresponding assignment of Mortgage referred to in clause
(iii) above;
(viii) originals or copies of all assumption, modification,
written assurance and substitution agreements, with
evidence of recording thereon if appropriate, in those
instances where the terms or provisions of the Mortgage,
Mortgage Note or any related security document have been
modified or the Mortgage Loan has been assumed;
(ix) the original or a copy of the lender's title insurance
policy issued as of the date of the origination of the
Mortgage Loan, together with all endorsements or riders (or
copies thereof) that were issued with or subsequent to the
issuance of such policy, insuring the priority of the
Mortgage as a first lien on the Mortgaged Property;
(x) the original or a copy of any guaranty of the obligations
of the mortgagor under the Mortgage Loan together with (A)
if applicable, the original or copies of any intervening
assignments of such guaranty showing a complete chain of
assignment from the originator of the Mortgage Loan to the
most recent assignee thereof prior to the Trustee, if any,
and (B) an original assignment of such guaranty executed by
the most recent assignee thereof prior to the Trustee or,
if none, by the originator;
(xi) (A) file or certified copies of any UCC financing
statements and continuation statements which were filed in
order to perfect (and maintain the perfection of) any
security interest held by the originator of the Mortgage
Loan (and each assignee of record prior to the Trustee) in
and to the personalty of the mortgagor at the Mortgaged
Property (in each case with evidence of filing thereon) and
which were in the possession of the Seller (or its agent)
at the time the Mortgage Files were delivered to the
Trustee and (B) if any such security interest is perfected
and the earlier UCC financing statements and continuation
statements were in the possession of the Seller, a UCC
financing statement executed by the most recent assignee of
record prior to the Trustee or, if none, by the originator,
evidencing the transfer of such security interest, either
in blank or in favor of the Trustee;
(xii) the original or a copy of the power of attorney (with
evidence of recording thereon, if appropriate) granted by
the Mortgagor if the Mortgage, Mortgage Note or other
document or instrument referred to above was signed on
behalf of the Mortgagor; and
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(xiii) if the Mortgagor has a leasehold interest in the related
Mortgaged Property, the original ground lease or a copy
thereof;
provided that whenever the term "Mortgage File" is used to refer to documents
actually received by the Purchaser or the Trustee, such term shall not be deemed
to include such documents and instruments required to be included therein unless
they are actually so received. The original assignments referred to in clauses
(iii), (v), (vii) and (x)(B), may be in the form of one or more instruments in
recordable form in any applicable filing offices. The "Mortgage File" with
respect to the Mortgage Loan identified as "GMAC 1010" on the Mortgage Loan
Schedule shall, subject to Section 2(b), collectively consist of :
(a) the documents referred to in clauses (i), (ii), (iv), (vi),
(viii), (ix), (x), (xi) (but only in the condition delivered to
the Seller), (xii) and (xiii);
(b) the Amended and Restated Trust Agreement, dated as of April 1,
1998, among Senior Living Properties LLC, SLP Illinois, LLC, ZC
Specialty Insurance Company, the Seller, HSCP Funding, Inc.,
Complete Care Services, L.P. and The First National Bank of
Chicago;
(c) the Subrogation and Note Purchase Agreement, dated as of February
6, 1998, between the Seller and ZC Specialty Insurance Company;
(d) the First Amendment to the Subrogation and Note Purchase
Agreement, dated as of April 1, 1998, between the Seller and ZC
Specialty Insurance Company;
(e) the Loan Agreement, dated as of February 6, 1998, among Senior
Living Properties LLC, SLP Illinois, LLC and the Seller;
(f) the First Amendment to Loan Agreement dated as of April 1, 1998,
among Senior Living Properties LLC, SLP Illinois, LLC and the
Seller.
B-3
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EXHIBIT C
REPRESENTATIONS AND WARRANTIES OF THE SELLER
REGARDING THE INDIVIDUAL MORTGAGE LOANS
With respect to each Mortgage Loan, the Seller hereby represents and warrants,
as of the date hereinbelow specified or, if no such date is specified, as of the
Closing Date, except as set forth on Schedule C-1 hereto, that:
(i) Ownership of Mortgage Loans. Immediately prior to the transfer thereof
to the Purchaser, the Seller had good and marketable title to, and was the sole
owner and holder of, such Mortgage Loan, free and clear of any and all liens,
encumbrances and other interests on, in or to such Mortgage Loan (other than, in
certain cases, the right of a subservicer to directly service such Mortgage
Loan). Such transfer validly assigns ownership of such Mortgage Loan to the
Purchaser free and clear of any pledge, lien, encumbrance or security interest.
(ii) Authority to Transfer Mortgage Loans. The Seller has full right and
authority to sell, assign and transfer such Mortgage Loan. 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.
(iii) Mortgage Loan Schedule. The information pertaining to such Mortgage
Loan set forth in the Mortgage Loan Schedule was true and correct in all
material respects as of the Cut-off Date.
(iv) Payment Record. Such Mortgage Loan was not as of the Cut-off Date, and
has not been during the twelve-month period prior thereto, 30 days or more
delinquent in respect of any debt service payment required thereunder, without
giving effect to any applicable grace period.
(v) Permitted Encumbrances. The Permitted Encumbrances (as defined in the
Mortgage Loan Purchase Agreement of which this Exhibit C forms a part) do not
materially interfere with the security intended to be provided by the related
Mortgage, the current use or operation of the related Mortgaged Property or the
current ability of the Mortgaged Property to generate net operating income
sufficient to service the Mortgage Loan. If the Mortgaged Property is operated
as a nursing facility, a hospitality property or a multifamily property, the
Mortgage, together with any separate security agreement, similar agreement and
UCC financing statement, if any, establishes and creates a first priority,
perfected security interest, to the extent such security interest can be
perfected by the recordation of a Mortgage or the filing of a UCC financing
statement, in all personal property owned by the Mortgagor that is used in, and
is reasonably necessary to, the operation of the related Mortgaged Property.
(vi) Title Insurance. The lien of the related Mortgage is insured by an
ALTA lender's title insurance policy ("Title Policy"), or its equivalent as
adopted in the applicable jurisdiction, issued by a nationally recognized title
insurance company, insuring the originator of such Mortgage Loan, its successors
and assigns, as to the first priority lien of the Mortgage in the original
principal amount of the Mortgage Loan after all advances of principal, subject
only to Permitted Encumbrances (or, if a title insurance policy has not yet been
issued in respect of the Mortgage Loan, a policy meeting the
C-1
<PAGE>
foregoing description is evidenced by a commitment for title insurance
"marked-up" at the closing of such loan). Each Title Policy (or, if it has yet
to be issued, the coverage to be provided thereby) is in full force and effect,
all premiums thereon have been paid and, to the Seller's knowledge, no material
claims have been made thereunder and no claims have been paid thereunder. The
Seller has not, by act or omission, done anything that would materially impair
the coverage under such Title Policy. Immediately following the transfer and
assignment of the related Mortgage Loan to the Trustee, such Title Policy (or,
if it has yet to be issued, the coverage to be provided thereby) will inure to
the benefit of the Trustee without the consent of or notice to the insurer.
(vii) No Waivers by Seller of Material Defaults. The Seller has not waived
any material default, breach, violation or event of acceleration existing under
the related Mortgage or Mortgage Note.
(viii) No Offsets, Defenses or Counterclaims. There is no valid offset,
defense or counterclaim to such Mortgage Loan.
(ix) Condition of Property; Condemnation. Except as set forth in any
engineering report prepared in connection with the origination of (or obtained
in connection with or otherwise following the Seller's acquisition of) such
Mortgage Loan, the related Mortgaged Property is, to the Seller's knowledge,
free and clear of any damage that would materially and adversely affect its
value as security for such Mortgage Loan. The Seller has no actual notice of the
commencement of a proceeding for the condemnation of all or any material portion
of the related Mortgaged Property.
(x) Compliance with Usury Laws. Such Mortgage Loan complied with all
applicable usury laws in effect at its date of origination.
(xi) Full Disbursement of Mortgage Loan Proceeds. The proceeds of such
Mortgage Loan have been fully disbursed and there is no requirement for future
advances thereunder.
(xii) Enforceability. The related Mortgage Note and Mortgage and all other
documents and instruments evidencing, guaranteeing, insuring or otherwise
securing such Mortgage Loan have been duly and properly executed by the parties
thereto, and each is the legal, valid and binding obligation of the maker
thereof (subject to any non-recourse provisions contained in any of the
foregoing agreements and any applicable state anti-deficiency legislation),
enforceable in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, receivership, moratorium or
other laws relating to or affecting the rights of creditors generally and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(xiii) Insurance. All improvements upon the related Mortgaged Property are
insured against loss by hazards of extended coverage in an amount (subject to a
customary deductible) at least equal to the lesser of the outstanding principal
balance of such Mortgage Loan and 100% of the full replacement cost of the
improvements located on such Mortgaged Property and the related hazard insurance
policy contains appropriate endorsements to avoid the application of
co-insurance and does not permit reduction in insurance proceeds for
depreciation. If any portion of the related Mortgaged Property was, at the time
of the origination of such Mortgage Loan, in an area identified in the Federal
Register by the Federal Emergency Management Agency as having special flood
hazards, and flood insurance was
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<PAGE>
available, a flood insurance policy meeting any requirements of the then current
guidelines of the Federal Insurance Administration is in effect with a generally
acceptable insurance carrier, in an amount representing coverage not less than
the least of (1) the outstanding principal balance of such Mortgage Loan, (2)
the full insurable value of such Mortgaged Property, (3) the maximum amount of
insurance available under the National Flood Insurance Act of 1968, as amended,
and (4) 100% of the replacement cost of the improvements located on such
Mortgaged Property. In addition, the Mortgage requires the Mortgagor to maintain
in respect of the Mortgaged Property comprehensive general liability insurance
in amounts generally required by the Seller, and at least six months rental or
business interruption insurance, and all such insurance required by the Mortgage
to be maintained is in full force and effect. Each such insurance policy
requires prior notice to the holder of the Mortgage of termination or
cancellation, and no such notice has been received, including any notice of
nonpayment of premiums, that has not been cured.
(xiv) Environmental Condition. The related Mortgaged Property was subject
to one or more environmental site assessments (or an update of a previously
conducted assessment), which was (were) performed on behalf of the Seller, or as
to which the related report was delivered to the Seller in connection with its
origination or acquisition of such Mortgage Loan; and the Seller, having made no
independent inquiry other than reviewing the resulting report(s) and/or
employing an environmental consultant to perform the assessment(s) referenced
herein, has no knowledge of any material and adverse environmental conditions or
circumstance affecting such Mortgaged Property that was not disclosed in the
related report(s). The Seller has not taken any action with respect to such
Mortgage Loan or the related Mortgaged Property that could subject the
Purchaser, or its successors and assigns in respect of the Mortgage Loan, to any
liability under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended ("CERCLA") or any other applicable federal,
state or local environmental law, and the Seller has not received any actual
notice of a material violation of CERCLA or any applicable federal, state or
local environmental law with respect to the related Mortgaged Property that was
not disclosed in the related report. The related Mortgage or loan documents in
the related Mortgage File requires the Mortgagor to comply with all applicable
federal, state and local environmental laws and regulations.
(xv) No Cross-Collateralization with Other Mortgage Loans. Such Mortgage
Loan is not cross-collateralized with any mortgage loan that will not be
included in the Trust Fund.
(xvi) Waivers and Modifications. The terms of the related Mortgage and the
Mortgage Note have not been impaired, waived, altered or modified in any
material respect, except as specifically set forth in the related Mortgage File.
(xvii) Taxes and Assessments. There are no delinquent taxes, ground rents,
assessments for improvements or other similar outstanding charges affecting the
related Mortgaged Property which are or may become a lien of priority equal to
or higher than the lien of the related Mortgage. For purposes of this
representation and warranty, real property taxes and assessments shall not be
considered unpaid until the date on which interest and/or penalties would be
payable thereon.
(xviii) Mortgagor's Interest in Mortgaged Property. Except in the case of
three Mortgage Loans as to which the interest of the related Mortgagor in the
related Mortgaged Property is in whole or in part a leasehold estate, the
interest of the related Mortgagor in the related Mortgaged
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<PAGE>
Property consists of a fee simple estate in real property.
(xix) Whole Loan. Each Mortgage Loan is a whole loan and not a
participation interest.
(xx) Valid Assignment. The assignment of the related Mortgage referred to
in clause (iii) of Exhibit B constitutes the legal, valid and binding assignment
of such Mortgage from the relevant assignor to the Trustee. The Assignment of
Leases set forth in the Mortgage or separate from the related Mortgage and
related to and delivered in connection with each Mortgage Loan establishes and
creates a valid, subsisting and, subject only to Permitted Encumbrances,
enforceable first priority lien and first priority security interest in the
related Mortgagor's interest in all leases, subleases, licenses or other
agreements pursuant to which any person is entitled to occupy, use or possess
all or any portion of the real property subject to the related Mortgage, and
each assignor thereunder has the full right to assign the same. The related
assignment of any Assignment of Leases, not included in a Mortgage, executed and
delivered in favor of the Trustee is in recordable form and constitutes a legal,
valid and binding assignment, sufficient to convey to the assignee named therein
all of the assignor's right, title and interest in, to and under such Assignment
of Leases.
(xxi) Escrows. All escrow deposits relating to such Mortgage Loan that are,
as of the Closing Date, required to be deposited with the mortgagee or its agent
have been so deposited.
(xxii) No Mechanics' or Materialmen's Liens. As of the date of origination
of such Mortgage Loan and, to the actual knowledge of the Seller, as of the
Closing Date, the related Mortgaged Property was and is free and clear of any
mechanics' and materialmen's liens or liens in the nature thereof which create a
lien prior to that created by the related Mortgage, except those which are
insured against by the Title Policy referred to in (vi) above.
(xxiii) No Material Encroachments. 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 any material
extent (unless affirmatively covered by the title insurance referred to in
paragraph (vi) above), and no improvements on adjoining properties encroached
upon such Mortgaged Property to any material extent. To the Seller's knowledge,
based upon opinions of counsel and/or other due diligence customarily performed
by the Seller, the improvements located on or forming part of such Mortgaged
Property comply in all material respects with applicable zoning laws and
ordinances (except to the extent that they may constitute legal non-conforming
uses).
(xxiv) Originator Authorized. 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.
(xxv) No Material Default. (A) To the Seller's knowledge, there exists no
material default, breach or event of acceleration under the related Mortgage or
Mortgage Note, and (B) the Seller has not received actual notice of any event
(other than payments due but not yet delinquent) that, with
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<PAGE>
the passage of time or with notice and the expiration of any grace or cure
period, would constitute such a material default, breach or event of
acceleration; provided, however, that this representation and warranty does not
cover any default, breach or event of acceleration that specifically pertains to
any matter otherwise covered or addressed by any other representation and
warranty made by the Seller herein.
(xxvi) [Reserved.]
(xxvii) No Equity Participation or Contingent Interest. The Mortgage Loan
contains no equity participation by the lender, and does not provide for any
contingent or additional interest in the form of participation in the cash flow
of the related Mortgaged Property, or for negative amortization.
(xxviii) No Advances of Funds. No holder of the Mortgage Loan has, to the
Seller's knowledge, advanced funds or induced, solicited or knowingly received
any advance of funds from a party other than the owner of the related Mortgaged
Property, directly or indirectly, for the payment of any amount required by the
Mortgage Loan.
(xxix) Licenses, Permits, Etc. To the Seller's knowledge, based on due
diligence customarily performed in the origination of comparable mortgage loans
by the Seller, as of the date of origination of the Mortgage Loan, the related
Mortgagor or operator of the related Mortgaged Property was in possession of all
material licenses, permits and authorizations required by applicable laws for
the ownership and operation of the related Mortgaged Property as it was then
operated and if a related Mortgaged Property is improved by a skilled nursing,
congregate care or assisted living facility, the most recent inspection or
survey by governmental authorities having jurisdiction in connection with such
licenses, permits and authorizations did not cite such Mortgaged Property for
material violations (which shall include only "Level A" (or equivalent)
violations in the case of skilled nursing facilities) that had not been cured or
as to which a plan of correction had not been submitted to and accepted by such
governmental authorities. To the extent such facility participates in Medicaid
or Medicare, such facility is in compliance in all material respects with the
requirements of such program.
(xxx) Servicing. The servicing and collection practices used with respect
to the Mortgage Loan have complied with applicable law in all material respects
and are consistent with the servicing standard set forth in Section 3.01(a) of
the Pooling and Servicing Agreement.
(xxxi) Customary Remedies. The related Mortgage or Mortgage Note, together
with applicable state law, contains customary and enforceable provisions
(subject to the exceptions set forth in paragraph (xii)) such as to render the
rights and remedies of the holders thereof adequate for the practical
realization against the related Mortgaged Property of the principal benefits of
the security intended to be provided thereby.
(xxxii) Insurance and Condemnation Proceeds. The related Mortgage provides
that insurance proceeds and condemnation proceeds will be applied either to
restore or repair the Mortgaged Property, or to repay the principal of the
Mortgage Loan or otherwise at the option of the holder of the Mortgage.
(xxxiii) LTV. The gross proceeds of each Mortgage Loan to the related
Mortgagor at origination did not exceed the non-contingent principal amount of
the Mortgage Loan and either: (A)
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<PAGE>
such Mortgage Loan is secured by an interest in real property having a fair
market value (1) at the date the Mortgage Loan was originated at least equal to
80 percent of the original principal balance of the Mortgage Loan or (2) at the
Closing Date at least equal to 80 percent of the principal balance of the
Mortgage Loan on such date; provided that for purposes hereof, the fair market
value of the real property interest must first be reduced by (X) the amount of
any lien on the real property interest that is senior to the Mortgage Loan and
(Y) a proportionate amount of any lien that is in parity with the Mortgage Loan
(unless such other lien secures a Mortgage Loan that is cross-collateralized
with such Mortgage Loan, in which event the computation described in clauses (1)
and (2) of this paragraph (xxxiii) shall be made on a pro rata basis in
accordance with the fair market values of the Mortgaged Properties securing such
cross-collateralized Mortgage Loans; or (B) substantially all the proceeds of
such Mortgage Loan were used to acquire, improve or protect the real property
which served as the only security for such Mortgage Loan (other than a recourse
feature or other third party credit enhancement within the meaning of Treasury
Regulations Section 1.860G-2(a)(1)(ii)).
(xxxiv) LTV and Significant Modifications. If the Mortgage Loan was
"significantly modified" prior to the Closing Date so as to result in a taxable
exchange under Section 1001 of the Code, it either (A) was modified as a result
of the default or reasonably foreseeable default of such Mortgage Loan or (B)
satisfies the provisions of either clause (A)(1) of paragraph (xxxiii)
(substituting the date of the last such modification for the date the Mortgage
Loan was originated) or clause (A)(2) of paragraph (xxxiii), including the
proviso thereto.
(xxxv) Inspection. In connection with the origination or acquisition of
each Mortgage Loan, the Seller inspected or caused to be inspected the Mortgaged
Property.
(xxxvi) Litigation. 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) Leasehold Estate. Each Mortgaged Property consists of the related
Mortgagor's fee simple estate in real estate or, if the related Mortgage Loan is
secured in whole or in part by the interest of a Mortgagor as a lessee under a
ground lease of a Mortgaged Property (a "Ground Lease"), by the related
Mortgagor's interest in the Ground Lease but not by the related fee interest in
such Mortgaged Property (the "Fee Interest") or if the Mortgage Loan is secured
in whole or in part by a Ground Lease and a Fee Interest, either (1) the ground
lessor's fee interest is subordinated to the lien of the Mortgage or (2) the
following apply to such Ground Lease:
(a) To the actual knowledge of the Seller, such Ground Lease or a
memorandum thereof has been or will be duly recorded; such Ground
Lease (or the related estoppel letter or lender protection
agreement between the Seller and related lessor) permits the
interest of the lessee thereunder to be encumbered by the related
Mortgage; and there has been no material change in the payment
terms of such Ground Lease since the origination of the related
Mortgage Loan, with the exception of material changes reflected in
written instruments that are a part of the related Mortgage File;
C-6
<PAGE>
(b) The lessee's interest in such Ground Lease is not subject to any
liens or encumbrances superior to, or of equal priority with, the
related Mortgage, other than the ground lessor's related fee
interest and Permitted Encumbrances;
(c) The Mortgagor's interest in such Ground Lease is assignable to the
Purchaser and its successors and assigns upon notice to, but
without the consent of, the lessor thereunder (or, if 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
Purchaser and its successors and assigns upon notice to, but
without the need to obtain the consent of, such lessor;
(d) Such Ground Lease is in full force and effect, and the Seller has
received no notice that an event of default has occurred
thereunder, and, to the Seller's actual knowledge, there exists no
condition that, but for the passage of time or the giving of
notice, or both, would result in an event of default under the
terms of such Ground Lease;
(e) Such Ground Lease, or an estoppel letter or other agreement,
requires the lessor under such Ground Lease to give notice of any
default by the lessee to the mortgagee, provided that the
mortgagee has provided the lessor with notice of its lien in
accordance with the provisions of such Ground Lease, and such
Ground Lease, or an estoppel letter or other agreement, further
provides that no notice of termination given under such Ground
Lease is effective against the mortgagee unless a copy has been
delivered to the mortgagee;
(f) A mortgagee is permitted a reasonable opportunity (including,
where necessary, sufficient time to gain possession of the
interest of the lessee under such Ground Lease) to cure any
default under such Ground Lease, which is curable after the
receipt of notice of any such default, before the lessor
thereunder may terminate such Ground Lease;
(g) Such Ground Lease has an original term (including any extension
options set forth therein) which extends not less than ten years
beyond the Stated Maturity Date of the related Mortgage Loan;
(h) Under the terms of such Ground Lease and the related Mortgage,
taken together, any related insurance proceeds other than in
respect of a total or substantially total loss or taking, will be
applied either to the repair or restoration of all or part of the
related Mortgaged Property, with the mortgagee or a trustee
appointed by it having the right to hold and disburse such
proceeds as the repair or restoration progresses (except in such
cases where a provision entitling another party to hold and
disburse such proceeds would not be viewed as commercially
unreasonable by a prudent commercial mortgage lender), or to the
payment of the outstanding principal balance of the Mortgage Loan
together with any accrued interest thereon; and
(i) Such Ground Lease does not impose any restrictions on subletting
which would
C-7
<PAGE>
be viewed, as of the date of origination of the related Mortgage
Loan, as commercially unreasonable by the Seller; and such Ground
Lease contains a covenant that the lessor thereunder is not
permitted, in the absence of an uncured default, to disturb the
possession, interest or quiet enjoyment of any subtenant of the
lessee, or in any manner, which would materially adversely affect
the security provided by the related Mortgage.
(j) Such Ground Lease requires the lessor to enter into a new lease in
the event of a termination of the Ground Lease by reason of a
default by the Mortgagor under the Ground Lease, including,
rejection of the ground lease in a bankruptcy proceeding.
(xxxviii) Deed of Trust. 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.
(xxxix) Lien Releases. Except in cases where either (a) a release of a
portion of the Mortgaged Property was contemplated at origination of the
Mortgage Loan and such portion was not considered material for purposes of
underwriting the Mortgage Loan or (b) release is conditioned upon the
satisfaction of certain underwriting and legal requirements and the payment of a
release price, the related Mortgage Note or Mortgage does not require the holder
thereof to release all or any portion of the Mortgaged Property from the lien of
the related Mortgage except upon payment in full of all amounts due under such
Mortgage Loan.
(xl) Junior Liens. The Mortgage Loan does not permit the related Mortgaged
Property to be encumbered by any lien junior to or of equal priority with the
lien of the related Mortgage without the prior written consent of the holder
thereof or the satisfaction of debt service coverage or similar conditions
specified therein.
(xli) Mortgagor Bankruptcy. To the Seller's knowledge, the Mortgagor is not
a debtor in any state or federal bankruptcy or insolvency proceeding.
(xlii) Due Organization of Mortgagors. As of the date of origination of
each Mortgage, each related Mortgagor which is not a natural person was duly
organized and validly existing under the laws of the state of its jurisdiction.
(xliii) Due-On-Sale. The Mortgage Loan contains provisions for the
acceleration of the payment of the unpaid principal balance of such Mortgage
Loan if, without complying with the requirements of such Mortgage Loan, the
related Mortgaged Property, or any controlling interest therein, is directly or
indirectly transferred or sold.
(xliv) Single Purpose Entity. Except for those Mortgage Loans identified on
Schedule C-1 hereto which represent 2.95% of the Mortgage Loans by Cut-Off Date
Principal Balance, the Mortgagor is an entity, other than an individual, whose
organizational documents or the related Mortgage Loan Documents provide
substantially to the effect that the Mortgagor: (a) is formed or organized
solely for the purpose of owning and operating one or more of the Mortgaged
Properties securing the Mortgage Loans, (b) may not engage in any business
unrelated to such Mortgaged Property or Mortgaged Properties, (c) does not have
any assets other than those related to its interest in and
C-8
<PAGE>
operation of such Mortgage Property or Mortgaged Properties, (d) may not incur
indebtedness other than as permitted by the related Mortgage or other Mortgage
Loan Documents, (e) has its own books and records separate and apart from any
other person, and (f) holds itself out as a legal entity, separate and apart
from any other person.
(xlv) [Reserved.]
(xlvi) Defeasance Provisions. Any Mortgage Loan which contains a provision
for any defeasance of mortgage collateral either (A) requires the consent of the
holder of the Mortgage Loan to any defeasance, or (B) permits defeasance (i) no
earlier than two years after the Closing Date (as defined in the Pooling and
Servicing Agreement, dated as of May 1, 1998), (ii) only with substitute
collateral constituting "government securities" within the meaning of Treas.
Reg. ss. 1.860G-2(a)(8)(i), and (iii) only to facilitate the disposition of
mortgage real property and not as a part of an arrangement to collateralize a
REMIC offering with obligations that are not real estate mortgages.
It is understood and agreed that the representations and warranties set
forth in this Exhibit C shall survive delivery of the respective Mortgage Files
to the Purchaser and/or the Trustee and shall inure to the benefit of the
Purchaser, and its successors and assigns (including without limitation the
Trustee and the holders of the Certificates), notwithstanding any restrictive or
qualified endorsement or assignment.
C-9
<PAGE>
SCHEDULE C-1 to EXHIBIT C
EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES
(v) Permitted Encumbrances
The following loan(s) have permitted encumbrances that materially affect
the security intended to be provided by the related Mortgage, the current
use and operation of the related Mortgaged Property.
Loan Number Property Issue
----------- -------- -----
GMAC 4090 Time Warner Building Tax lot doesn't coincide
with property described
in Mortgage.
Senior Living Properties-Texas Properties
GMAC 1010AZ Gilmer 15 foot wide easement runs
directly under building
GMAC 1010AU Electra Building encroaches
approximately 2 feet onto
sewer line for roughly
9.2 feet
GMAC 1010CB Riverside Two 20 foot sewer
easements run directly
underneath the building.
Senior Living Portfolio-Illinois properties
GMAC 1010AB Scotchwood Encroachment of building
onto easement by
approximately 3 feet.
(xvii) Taxes and Assessments
There are no delinquent taxes, ground rents, assessments for improvements
or other similar outstanding charges affecting the related Mortgaged
Property which are or may become a lien of priority equal to or higher
than the lien of the related Mortgage.
Loan Number Property Issue
----------- -------- -----
GMAC 4090 Time Warner Building Tax lot doesn't coincide
with property described
in Mortgage
(xxiii) No Material Encroachments
The following loan(s) have material encroachments by improvements which
lie outside the boundaries and building restriction lines of such
properties to a material extent or improvements from adjoining properties
encroaching upon the Mortgaged Properties, which are not covered by
affirmative title insurance coverage.
C-10
<PAGE>
Loan Number Property Issue
----------- -------- -----
GMAC 3300 Sunrise Apartments I Various setback violations
ranging from 2 to 13 feet
Senior Living Portfolio-Texas properties
GMAC 1010AX Garden Terrace Rear setbacks are
violated by 38 feet on
southerly part of building
GMAC 1010BA Graham Healthcare Ctr. Small setback encroachment
of approximately 1 foot at
corner of entrance to
building.
GMAC 1010BB Graham Living Ctr 16 foot building
encroachment onto setback
GMAC 1010BE Hearne Metal utility building
encroaches approximately
14 feet onto adjoining
property
GMAC 1010BJ Jeffrey Place One-story metal building
lies completely outside
of west boundary line.
The improvement located on or forming a part of the Mortgaged Property does
not comply in all material respects with applicable zoning laws and
ordinances.
Loan Number Property Issue
----------- -------- -----
GMAC 1010BJ Jeffrey Place Parking spaces required
are 53, only 39 provided.
(xxix) Licenses, Permits, Etc. The following loan(s) are improved with a skilled
nursing, congregate care or assisted living facility(ies) to the extent
such facility(ies) participates in Medicaid or Medicare, such facility(ies)
are in compliance in all material respects with the requirements of such
programs.
Loan Number Property Issue
----------- -------- -----
GMAC 1010 Senior Living Portfolio Each Illinois facility is
operating under a
provisional license.
Application has been
made for the transfer of
the licenses in Texas.
The licenses will not be
transferred until after
an inspection of each
facility has been
completed by appropriate
authorities. The
Illinois and Texas
facilities are in the
process of completing the
requisite supplemental
paperwork with the local
and state health
departments to
participate in the
Medicare and Medicaid
programs. Until the
application process is
complete the
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<PAGE>
facilities will not
receive Medicare or
Medicaid reimbursement.
(xliv) Borrowers on the following loan(s) are not single purpose entities to the
extent shown on the attached spreadsheet:
Loan Number Property
----------- --------
GMAC 1350 William Penn
GMAC 1370 Garden Village Retirement
GMAC 1470 Loyalhanna
GMAC 2240 New Hope
GMAC 2540 Evergreen Retirement
GMAC 3070 Studio City
GMAC 3260 Sunnyvale Nursing
GMAC 3340 Heritage Living
GMAC 2030 Tassaraja
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<PAGE>
Single Purpose Entity Criteria
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Organized solely May not engage in No other assets No other Separate books and Holds itself
for owning and any business indebtedness records out as
operating unrelated to incurred or to be separate
mortgaged premises property incurred and apart
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
William Penn Y Y Y N N N
- ------------------------------------------------------------------------------------------------------------------------------------
Garden Village N Y N N N N
- ------------------------------------------------------------------------------------------------------------------------------------
Loyalhanna Y Y Y N N N
- ------------------------------------------------------------------------------------------------------------------------------------
New Hope N N N N N N
- ------------------------------------------------------------------------------------------------------------------------------------
Evergreen N N N N N N
- ------------------------------------------------------------------------------------------------------------------------------------
Studio City N N N N N N
- ------------------------------------------------------------------------------------------------------------------------------------
Sunnyvale N N N N N N
- ------------------------------------------------------------------------------------------------------------------------------------
Heritage Y Y Y N N N
- ------------------------------------------------------------------------------------------------------------------------------------
Tassajara N N N N N N
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Y = YES MEETS CRITERIA
N = DOES NOT MEET CRITERIA
C-13
<PAGE>
EXHIBIT D-1
FORM OF CERTIFICATE OF AN OFFICER OF
THE SELLER
Certificate of Officer of GMAC Commercial Mortgage Corporation ("GMACCM")
I, _________________, a _________________ of GMACCM (the "Seller"), hereby
certify as follows:
The Seller is a corporation duly organized and validly existing under the
laws of the State of California.
Attached hereto as Exhibit I are true and correct copies of the Certificate
of Incorporation and By-Laws of the Seller, which Certificate of Incorporation
and By-Laws are on the date hereof, and have been at all times in full force and
effect.
To the best of my knowledge, no proceedings looking toward liquidation or
dissolution of the Seller are pending or contemplated.
Each person listed below is and has been the duly elected and qualified
officer or authorized signatory of the Seller and his genuine signature is set
forth opposite his name:
Name Office Signature
- ---- ------ ---------
Each person listed above who signed, either manually or by facsimile
signature, the Mortgage Loan Purchase Agreement, dated as of April 28, 1998 (the
"Purchase Agreement"), between the Seller and GMAC Commercial Mortgage
Securities, Inc. providing for the purchase by GMAC Commercial Mortgage
Securities, Inc. from the Seller of the Mortgage Loans, was, at the respective
times of such signing and delivery, duly authorized or appointed to execute such
documents in such capacity, and the signatures of such persons or facsimiles
thereof appearing on such documents are their genuine signatures.
Capitalized terms not otherwise defined herein have the meanings assigned
to them in the Purchase Agreement.
D-1-1
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed this certificate as of May
[__], 1998.
By:
---------------------------------------
Name:
Title:
I, [name], [title], hereby certify that ________________ is a duly elected
or appointed, as the case may be, qualified and acting ______________ of the
Seller and that the signatures appearing above is her genuine signatures.
IN WITNESS WHEREOF, the undersigned has executed this certificate as of May
[__], 1998.
By:
---------------------------------------
Name:
Title:
D-1-2
<PAGE>
EXHIBIT D-2
FORM OF CERTIFICATE OF THE SELLER
Certificate of GMAC Commercial Mortgage Corporation
In connection with the execution and delivery by GMAC Commercial Mortgage
Corporation (the "Seller") of, and the consummation of the transaction
contemplated by, that certain Mortgage Loan Purchase Agreement, dated as of
April 28, 1998 (the "Purchase Agreement"), between GMAC Commercial Mortgage
Securities, Inc. and the Seller, the Seller hereby certifies that (i) the
representations and warranties of the Seller in the Purchase Agreement are true
and correct in all material respects at and as of the date hereof with the same
effect as if made on the date hereof, and (ii) the Seller has, in all material
respects, complied with all the agreements and satisfied all the conditions on
its part to be performed or satisfied at or prior to the date hereof.
Capitalized terms not otherwise defined herein have the meanings assigned to
them in the Purchase Agreement.
Certified this ___ day of May, 1998.
GMAC COMMERCIAL MORTGAGE CORPORATION
By:
---------------------------------------
Name:
Title:
<PAGE>
EXHIBIT D-3A
FORM OF OPINION I OF COUNSEL TO THE SELLER
May [__], 1998
To: Persons on Annex A
Re: GMAC Commercial Mortgage Corporation,
Mortgage Pass-Through Certificates, Series 1998-C1
Ladies and Gentlemen:
I am General Counsel to GMAC Commercial Mortgage Corporation (the
"Seller"). In that capacity, I am familiar with the issuance of certain Mortgage
Pass-Through Certificates, Series 1998-C1 (the "Certificates"), evidencing
undivided interests in a trust fund (the "Trust Fund") consisting primarily of
certain mortgage loans (the "Mortgage Loans"), pursuant to a Pooling and
Servicing Agreement, dated as of May 1, 1998 (the "Pooling and Servicing
Agreement"), among GMAC Commercial Mortgage Securities, Inc. (the "Company") as
depositor, the Seller as master servicer and special servicer, LaSalle National
Bank as trustee (the "Trustee") and ABN AMRO Bank N.V. as fiscal agent.
Certain of the Mortgage Loans were purchased by the Company from the
Seller, pursuant to, and for the consideration described in, the Mortgage Loan
Purchase Agreement, dated as of April 28, 1998 (the "GMACCM Mortgage Loan
Purchase Agreement"), between the Company and the Seller. Certain of the
Mortgage Loans were purchased by the Company from German American Capital
Corporation ("GACC"), pursuant to, and for the consideration described in, the
Mortgage Loan Purchase Agreement, dated as of April 28, 1998 (the "GACC Mortgage
Loan Purchase Agreement"), between GACC and the Company. The Pooling and
Servicing Agreement and the GMACCM Mortgage Loan Purchase Agreement are referred
to herein together as the "Agreements." Capitalized terms not defined herein
have the meanings set forth in the Agreements. This opinion is rendered pursuant
to Section 8(e) of the GMACCM Mortgage Loan Purchase Agreement.
The Company has sold the Class X, Class A-1, Class A-2, Class B, Class C,
Class D, Class E and Class F Certificates (collectively, the "Publicly Offered
Certificates") to Deutsche Morgan Grenfell Inc. and Lehman Brothers Inc. as
representatives (the "Representatives") for themselves and the other
underwriters (the "Underwriters") named in the Underwriting Agreement, dated as
of April 28, 1998 (the "Underwriting Agreement"), among the Company, the Seller,
and the Representatives, and sold the Class G, Class H, Class J, Class K, Class
L, Class M, Class N, Class R-I, Class R-II and Class R-III Certificates
(collectively, the "Privately Offered Certificates") to Deutsche Morgan Grenfell
Inc. and Lehman Brothers Inc. as initial purchasers (the "Initial Purchasers")
pursuant to the Certificate Purchase Agreement, dated as of April 28, 1998 (the
"Certificate Purchase Agreement"), among the Company, the Seller and the Initial
Purchasers.
D-3A-1
<PAGE>
In connection with rendering this opinion letter, I have examined or have
caused persons under my supervision to examine the Agreements and such other
records and other documents as I have deemed necessary. I have further assumed
that there is not and will not be any other agreement that materially
supplements or otherwise modifies the agreements expressed in the Agreements. As
to matters of fact, I have examined and relied upon representations of parties
contained in the Agreements and, where I have deemed appropriate,
representations and certifications of officers of the Company, the Seller, the
Trustee, other transaction participants or public officials. I have assumed the
authenticity of all documents submitted to me as originals, the genuineness of
all signatures other than officers of the Seller and the conformity to the
originals of all documents submitted to me as copies. I have assumed that all
parties, except for the Company and] the Seller, had the corporate power and
authority to enter into and perform all obligations thereunder. As to such
parties, I also have assumed the due authorization by all requisite corporate
action, the due execution and delivery and the enforceability of such documents.
I have further assumed the conformity of the Mortgage Loans and related
documents to the requirements of the Agreements.
In rendering this opinion letter, I do not express any opinion concerning
any law other than the law of the Commonwealth of Pennsylvania, the General
Corporation Law of the State of Delaware and the federal law of the United
States, and I do not express any opinion concerning the application of the
"doing business" laws or the securities laws of any jurisdiction other than the
federal securities laws of the United States. To the extent that any of the
matters upon which I am opining herein are governed by laws ("Other Laws") other
than the laws identified in the preceding sentence, I have assumed with your
permission and without independent verification or investigation as to the
reasonableness of such assumption, that such Other Laws and judicial
interpretation thereof do not vary in any respect material to this opinion from
the corresponding laws of the Commonwealth of Pennsylvania and judicial
interpretations thereof. I do not express any opinion on any issue not expressly
addressed below.
Based upon the foregoing, I am of the opinion that:
1. The Seller is duly incorporated and is validly existing as a corporation in
good standing under the laws of the State of California, and has the
requisite power and authority, corporate or other, to own its properties
and conduct its business, as presently conducted by it, and to enter into
and perform its obligations under the Agreements.
2. Each of the Agreements has been duly and validly authorized, executed and
delivered by the Seller and, upon due authorization, execution and delivery
by the other parties thereto, will constitute the valid, legal and binding
agreements of the Seller, enforceable against the Seller in accordance with
their terms, except as enforceability may be limited by (i) bankruptcy,
insolvency, liquidation, receivership, moratorium, reorganization or other
similar laws affecting the rights of creditors, (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 the Agreements which purport to provide
indemnification with respect to securities law violations.
D-3A-2
<PAGE>
3. No consent, approval, authorization or order of the Commonwealth of
Pennsylvania, or federal court or governmental agency or body is required
for the consummation by the Seller of the transactions contemplated by the
terms of the Agreements, except for those consents, approvals,
authorizations or orders which previously have been obtained.
4. Neither the consummation of any of the transactions contemplated by, nor
the fulfillment by the Seller of any other of the terms of, the Agreements,
will result in a material breach of any term or provision of the charter or
bylaws of the Seller or any Commonwealth of Pennsylvania or federal statute
or regulation or conflict with, result in a material breach, violation or
acceleration of or constitute a material default under the terms of any
indenture or other material agreement or instrument to which the Seller is
a party or by which it is bound or any order or regulation of any
Commonwealth of Pennsylvania or federal court, regulatory body,
administrative agency or governmental body having jurisdiction over the
Seller.
D-3A-3
<PAGE>
This opinion letter is rendered for the sole benefit of each addressee
hereof, and no other person or entity, except Orrick, Herrington & Sutcliffe
LLP, is entitled to rely hereon without prior written consent. Copies of this
opinion letter may not be furnished to any other person or entity, nor may any
portion of this opinion letter be quoted, circulated or referred to in any other
document without my prior written consent.
Very truly yours,
Maria Corpora-Buck
General Counsel
D-3A-4
<PAGE>
Annex A
GMAC Commercial Mortgage Securities, Inc.
Deutsche Morgan Grenfell Inc.
Lehman Brothers Inc.
Residential Funding Securities Corporation
LaSalle National Bank
ABN AMRO Bank N.V.
Moody's Investors Service, Inc.
FITCH IBCA Inc.
D-3A-5
<PAGE>
EXHIBIT D-3B
FORM OF OPINION II OF COUNSEL TO THE SELLER
EXHIBIT 99.2
EXECUTION COPY
MORTGAGE LOAN PURCHASE AGREEMENT
This Mortgage Loan Purchase Agreement (this "Agreement"), is dated and
effective as of April 28, 1998, between German American Capital Corporation as
seller (the "Seller") and GMAC Commercial Mortgage Securities, Inc. as purchaser
(the "Purchaser").
The Seller desires to sell, assign, transfer and otherwise convey to the
Purchaser, and the Purchaser desires to purchase, subject to the terms and
conditions set forth below, the multifamily and commercial mortgage loans (the
"Mortgage Loans") identified on the schedule annexed hereto as Exhibit A (the
"Mortgage Loan Schedule").
It is expected that the Mortgage Loans will be transferred, together with
other multifamily and commercial mortgage loans to a trust fund (the "Trust
Fund") to be formed by the Purchaser, beneficial ownership of which will be
evidenced by a series of mortgage pass-through certificates (the
"Certificates"). Certain classes of the Certificates will be rated by Moody's
Investors Service, Inc. and FITCH IBCA Inc. (together, the "Rating Agencies").
Certain classes of the Certificates (the "Registered Certificates") will be
registered under the Securities Act of 1933, as amended (the "Securities Act").
The Trust Fund will be created and the Certificates will be issued pursuant to a
pooling and servicing agreement to be dated as of May 1, 1998 (the "Pooling and
Servicing Agreement"), among the Purchaser as depositor, GMAC Commercial
Mortgage Corporation as master servicer (in such capacity, the "Master
Servicer") and special servicer (in such capacity, the "Special Servicer"),
LaSalle National Bank as trustee (in such capacity, the "Trustee") and ABN AMRO
Bank N.V. as fiscal agent. Capitalized terms not otherwise defined herein have
the meanings assigned to them in the Pooling and Servicing Agreement.
The Purchaser intends to sell certain of the Certificates to Deutsche
Morgan Grenfell Inc., Lehman Brothers Inc. and Residential Funding Securities
Corp. (together, the "Underwriters") pursuant to an underwriting agreement dated
the date hereof (the "Underwriting Agreement"). The Purchaser intends to sell
the remaining Certificates (the "Non-Registered Certificates") to Deutsche
Morgan Grenfell Inc. and Lehman Brothers Inc. (the "Initial Purchasers),
pursuant to a certificate purchase agreement dated the date hereof (the
"Certificate Purchase Agreement").
Now, therefore, in consideration of the premises and the mutual agreements
set forth herein, the parties agree as follows:
<PAGE>
SECTION 1. Agreement to Purchase.
The Seller agrees to sell, assign, transfer and otherwise convey to the
Purchaser, and the Purchaser agrees to purchase, the Mortgage Loans. The
purchase and sale of the Mortgage Loans shall take place on May 18, 1998 or such
other date as shall be mutually acceptable to the parties hereto (the "Closing
Date"). As of the close of business on May 1, 1998 (the "Cut-off Date"), the
Mortgage Loans will have an aggregate principal balance (the "Aggregate Cut-off
Date Balance"), after application of all payments of principal due thereon on or
before such date, whether or not received, of $239,717,501, subject to a
variance of plus or minus 5%. The purchase price for the Mortgage Loans shall be
determined and paid to the Seller in accordance with the terms of an allocation
agreement dated the date hereof (the "Allocation Agreement"), to which the
Seller and Purchaser, among others, are parties.
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt by the Seller
of the purchase price referred to in Section 1 hereof (exclusive of any
applicable holdback for transaction expenses in accordance with the Allocation
Agreement), 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 Mortgage Loans identified on the Mortgage
Loan Schedule as of such date, including all interest and principal received or
receivable by the Seller on or with respect to the Mortgage Loans after the
Cut-off Date, together with all of the Seller's right, title and interest in and
to the proceeds of any related title, hazard, or other insurance policies and
any escrow, reserve or other comparable accounts related to the Mortgage Loans.
The Purchaser shall be entitled to (and, to the extent received by or on behalf
of the Seller, the Seller shall deliver or cause to be delivered to or at the
direction of the Purchaser) all scheduled payments of principal and interest due
on the Mortgage Loans after the Cut-off Date, and all other recoveries of
principal and interest collected thereon after the Cut-off Date. All scheduled
payments of principal and interest due thereon on or before the Cut-off Date and
collected after the Cut-off Date shall belong to the Seller.
(b) In connection with the Seller's assignment pursuant to subsection (a)
above, the Seller hereby agrees that, at least five (5) Business Days before the
Closing Date, it shall have delivered to and deposited with the Trustee, the
Mortgage File (as described on Exhibit B hereto) for each Mortgage Loan so
assigned. It is further acknowledged and agreed by the Seller that the Purchaser
intends to cause the Trustee to perform a limited review of such Mortgage Files
to enable the Trustee to confirm to the Purchaser on or before the Closing Date
that the Mortgage Note referred to in clause (i) of Exhibit B has been delivered
by the Seller with respect to each such Mortgage File. In the event Seller fails
to so deliver each such Mortgage File to the Trustee, the Purchaser and its
successors and assigns shall be entitled to pursue any rights or remedies in
respect of such failure as may be available under applicable law. If the Seller
cannot deliver, or cause to be delivered, as to any Mortgage Loan, the original
or a copy of any of the documents and/or instruments referred to in clauses
(ii), (iv), (viii), (xi)(A) and (xii) of Exhibit B, with evidence of recording
thereon, solely because of a delay caused by the public recording or filing
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<PAGE>
office where such document or instrument has been delivered for recordation or
filing, or because such original recorded document has been lost or returned
from the recording or filing office and subsequently lost, as the case may be,
the delivery requirements of this Section 2(b) shall be deemed to have been
satisfied as to such missing item, and such missing item shall be deemed to have
been included in the related Mortgage File, provided that a copy of such
document or instrument (without evidence of recording or filing thereon, but
certified (which certificate may relate to multiple documents and/or
instruments) by the Seller to be a true and complete copy of the original
thereof submitted for recording or filing, as the case may be) has been
delivered to the Trustee, and either the original of such missing document or
instrument, or a copy thereof, with evidence of recording or filing, as the case
may be, thereon, is delivered to or at the direction of the Purchaser (or any
subsequent owner of the affected Mortgage Loan, including without limitation the
Trustee) within 180 days of the Closing Date (or within such longer period after
the Closing Date as the Purchaser (or such subsequent owner) may consent to,
which consent shall not be unreasonably withheld so long as the Seller has
provided the Purchaser (or such subsequent owner) with evidence of such
recording or filing, as the case may be, or has certified to the Purchaser (or
such subsequent owner) as to the occurrence of such recording or filing, as the
case may be, and is, as certified to the Purchaser (or such subsequent owner) no
less often than quarterly, in good faith attempting to obtain from the
appropriate county recorder's or filing office such original or copy). If the
Seller cannot deliver, or cause to be delivered, as to any Mortgage Loan, the
original or a copy of the related lender's title insurance policy referred to in
clause (ix) of Exhibit B solely because such policy has not yet been issued, the
delivery requirements of this Section 2(b) shall be deemed to be satisfied as to
such missing item, and such missing item shall be deemed to have been included
in the related Mortgage File, provided that the Seller has delivered to the
Trustee a commitment for title insurance "marked-up" at the closing of such
Mortgage Loan, and the Seller shall deliver to or at the direction of the
Purchaser (or any subsequent owner of the affected Mortgage Loan, including
without limitation the Trustee), promptly following the receipt thereof, the
original related lender's title insurance policy (or a copy thereof). In
addition, notwithstanding anything to the contrary contained herein, if there
exists with respect to any group of related cross-collateralized Mortgage Loans
only one original of any document referred to in Exhibit B covering all the
Mortgage Loans in such group, then the inclusion of the original of such
document in the Mortgage File for any of the Mortgage Loans in such group shall
be deemed an inclusion of such original in the Mortgage File for each such
Mortgage Loan. On the Closing Date, upon notification from the Seller that the
purchase price referred to in Section 1 (exclusive of any applicable holdback
for transaction expenses in accordance with the Allocation Agreement) has been
received by the Seller, the Trustee shall be authorized to release to the
Purchaser or its designee all of the Mortgage Files in the Trustee's possession
relating to the Mortgage Loans.
(c) As to each Mortgage Loan, the Seller shall be responsible for all costs
associated with the recording or filing, as the case may be, of each assignment
referred to in clauses (iii) and (v) of Exhibit B and each UCC-2 and UCC-3, if
any, referred to in clause (xi)(B) of Exhibit B; provided that the Seller shall
not be responsible for actually recording or filing any such document or
instrument. If any such document or instrument is lost or returned unrecorded or
unfiled, as
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<PAGE>
the case may be, because of a defect therein, the Seller shall promptly prepare
or cause the preparation of a substitute therefor or cure or cause the curing of
such defect, as the case may be, and shall thereafter deliver the substitute or
corrected document to or at the direction of the Purchaser (or any subsequent
owner of the affected Mortgage Loan, including without limitation the Trustee)
for recording or filing, as appropriate, at the Seller's expense.
(d) All documents and records in the Seller's possession (or under its
control) relating to the Mortgage Loans that are not required to be a part of a
Mortgage File in accordance with Exhibit B (all such other documents and
records, as to any Mortgage Loan, the "Servicing File"), together with all
escrow payments, reserve funds and other comparable funds in the possession of
the Seller (or under its control) with respect to the Mortgage Loans, shall
(unless they are held by a sub-servicer that shall, as of the Closing Date,
begin acting on behalf of the Master Servicer pursuant to a written agreement
between such parties) be delivered by the Seller (or its agent) to the Purchaser
(or its designee) no later than the Closing Date. If a sub-servicer shall, as of
the Closing Date, begin acting on behalf of the Master Servicer with respect to
any Mortgage Loan pursuant to a written agreement between such parties, the
Seller shall deliver a copy of the related Servicing File to the Master
Servicer.
(e) The Seller's records will reflect the transfer of the Mortgage Loans to
the Purchaser as a sale.
SECTION 3. Examination of Mortgage Loan Files and Due Diligence Review.
The Seller shall reasonably cooperate with any examination of the Mortgage
Files and Servicing Files that may be undertaken by or on behalf of the
Purchaser. The fact that the Purchaser has conducted or has failed to conduct
any partial or complete examination of the Mortgage Files and/or Servicing Files
shall not affect the Purchaser's right to pursue any remedy available in equity
or at law for a breach of the Seller's representations, warranties and covenants
set forth in or contemplated by Section 4.
SECTION 4. Representations, Warranties and Covenants of the Seller.
(a) The Seller hereby makes, as of the Closing Date (or as of such other
date specifically provided in the particular representation or warranty), to and
for the benefit of the Purchaser, and its successors and assigns (including,
without limitation, the Trustee and the holders of the Certificates), each of
the representations and warranties set forth in Exhibit C, with such changes or
modifications as may be permitted or required by the Rating Agencies.
(b) In addition, the Seller, as of the date hereof, hereby represents and
warrants to, and covenants with, the Purchaser that:
(i) The Seller is a corporation, duly organized, validly existing and
in good standing under the laws of the State of Maryland, and is in
compliance with the laws of each State in which any Mortgaged Property is
located to the extent necessary to ensure
4
<PAGE>
the enforceability of each Mortgage Loan and to perform its
obligations under this Agreement.
(ii) The execution and delivery of this Agreement by the Seller,
and the performance and compliance with the terms of this Agreement by
the Seller, will not violate the Seller'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 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, in each case which
materially and adversely affect the ability of the Seller to carry out
the transactions contemplated by this Agreement.
(iii) The Seller 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 the Purchaser, constitutes a valid, legal and binding
obligation of the Seller, enforceable against the Seller in accordance
with the terms hereof, subject to (A) applicable bankruptcy,
insolvency, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights generally, (B) general principles of
equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law, and (C) public policy considerations
underlying the securities laws, to the extent that such public policy
considerations limit the enforceability of the provisions of this
Agreement that purport to provide indemnification for securities laws
liabilities.
(v) The Seller 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 Seller's good faith and reasonable
judgment, is likely to affect materially and adversely either the
ability of the Seller to perform its obligations under this Agreement
or the financial condition of the Seller.
(vi) No litigation is pending with regard to which Seller has
received service of process or, to the best of the Seller's knowledge,
threatened against the Seller the outcome of which, in the Seller's
good faith and reasonable judgment, could reasonably be expected to
prohibit the Seller from entering into this Agreement or materially
and adversely affect the ability of the Seller to perform its
obligations under this Agreement.
(vii) The Seller has not dealt with any broker, investment
banker, agent or other person, other than the Purchaser, the
Underwriters, the Initial Purchasers, and their respective affiliates,
that may be entitled to any commission or compensation in connection
5
<PAGE>
with the sale of the Mortgage Loans or the consummation of any of the
other transactions contemplated hereby.
(viii) Neither the Seller 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 to 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 with respect to any Certificate,
any interest in any Certificate or any similar security, or (E) taken
any other action, that (in the case of any of the acts described in
clauses (A) through (E) above) would constitute or result in a
violation of the Securities Act or any state securities law relating
to or in connection with the issuance of the Certificates or require
registration or qualification pursuant to the Securities Act or any
state securities law of any Certificate not otherwise intended to be a
Registered Certificate. In addition, the Seller 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 of the
Certificates or interests therein. For purposes of this paragraph
4(b)(viii), the term "similar security" shall be deemed to include,
without limitation, any security evidencing or, upon issuance, that
would have evidenced an interest in the Mortgage Loans or any
substantial number thereof.
(ix) Insofar as it relates to the Mortgage Loans, the information
set forth on pages A-9 through A-13, inclusive, of Annex A to the
Prospectus Supplement (as defined in Section 9) (the "Loan Detail")
and, to the extent consistent therewith, the information set forth on
the diskette attached to the Prospectus Supplement and the
accompanying prospectus (the "Diskette"), is true and correct in all
material respects. Insofar as it relates to the Mortgage Loans and/or
the Seller and does not represent a restatement or aggregation of the
information on the Loan Detail, the information set forth in the
Prospectus Supplement and the Memorandum (as defined in Section 9)
under the headings "Summary of the Prospectus Supplement--The Mortgage
Asset Pool", "Risk Factors--The Mortgage Loans" and "Description of
the Mortgage Asset Pool", set forth on Annex A to the Prospectus
Supplement and (to the extent it contains information consistent with
that on such Annex A) set forth on the Diskette, does not contain any
untrue statement of a material fact or (in the case of the Memorandum,
when read together with the other information specified therein as
being available for review by investors) omit to state any material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(x) 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 (including, with respect to any
bulk sale laws), for the execution, delivery and performance of or
compliance by the Seller with this Agreement, or the consummation by
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<PAGE>
the Seller of any transaction contemplated hereby, other than (1) the
filing or recording of financing statements, instruments of assignment
and other similar documents necessary in connection with Seller's sale
of the Mortgage Loans to the Purchaser, (2) such consents, approvals,
authorizations, qualifications, registrations, filings or notices as
have been obtained or made and (3) where the lack of such consent,
approval, authorization, qualification, registration, filing or notice
would not have a material adverse effect on the performance by the
Seller under this Agreement.
(c) Upon discovery by any of the parties hereto of a breach of any of the
representations and warranties made pursuant to and set forth in subsection (b)
above which materially and adversely affects the interests of the Purchaser or a
breach of any of the representations and warranties made pursuant to subsection
(a) above and set forth in Exhibit C which materially and adversely affects the
value of any Mortgage Loan or the interests therein of the Purchaser or its
successors and assigns (including, without limitation the Trustee and the
holders of the Certificates), the party discovering such breach shall give
prompt written notice to the other party hereto.
SECTION 5. Representations, Warranties and Covenants of the Purchaser.
(a) The Purchaser, as of the date hereof, hereby represents and warrants
to, and covenants with, the Seller that:
(i) The Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of State of Delaware.
(ii) The execution and delivery of this Agreement by the Purchaser,
and the performance and compliance with the terms of this Agreement by the
Purchaser, will not violate the Purchaser'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 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 Purchaser 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 the Seller, constitutes a valid, legal and binding obligation
of the Purchaser, enforceable against the Purchaser 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.
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<PAGE>
(v) The Purchaser 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 Purchaser's good faith and reasonable judgment, is likely
to affect materially and adversely either the ability of the Purchaser to
perform its obligations under this Agreement or the financial condition of
the Purchaser.
(vi) No litigation is pending or, to the best of the Purchaser's
knowledge, threatened against the Purchaser which would prohibit the
Purchaser from entering into this Agreement or, in the Purchaser's good
faith and reasonable judgment, is likely to materially and adversely affect
either the ability of the Purchaser to perform its obligations under this
Agreement or the financial condition of the Purchaser.
(vii) The Purchaser has not dealt with any broker, investment banker,
agent or other person, other than the Seller, the Underwriters, the Initial
Purchasers and their respective affiliates, that may be entitled to any
commission or compensation in connection with the sale of the Mortgage
Loans or the consummation of any of the transactions contemplated hereby.
(viii) 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 of or compliance by the Purchaser with this Agreement, or the
consummation by the Purchaser of any transaction contemplated hereby, other
than (1) such consents, approvals, authorizations, qualifications,
registrations, filings or notices as have been obtained or made and (2)
where the lack of such consent, approval, authorization, qualification,
registration, filing or notice would not have a material adverse effect on
the performance by the Purchaser under this Agreement.
(b) Upon discovery by any of the parties hereto of a breach of any of the
representations and warranties set forth above which materially and adversely
affects the interests of the Seller, the party discovering such breach shall
give prompt written notice to the other party hereto.
SECTION 6. Repurchases.
(a) Within 90 days of the earlier of discovery or receipt of notice by the
Seller, from either the Purchaser or any successor or assign thereof, of a
Defect (as defined in the Pooling and Servicing Agreement) in respect of the
Mortgage File for any Mortgage Loan or a breach of any representation or
warranty made pursuant to Section 4(a) and set forth in Exhibit C, which Defect
or breach, as the case may be, materially and adversely affects the value of any
Mortgage Loan or the interests therein of the Purchaser or its successors and
assigns (including, without limitation, the Trustee and the holders of the
Certificates), the Seller shall cure such Defect or
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<PAGE>
breach, as the case may be, in all material respects or repurchase the affected
Mortgage Loan from the then owner(s) thereof at the applicable Purchase Price
(as defined in the Pooling and Servicing Agreement) by payment of such Purchase
Price by wire transfer of immediately available funds to the account designated
by such owner(s); provided, however, that in lieu of effecting any such
repurchase, the Seller will be permitted to deliver a Qualifying Substitute
Mortgage Loan and to pay a cash amount equal to the applicable Substitution
Shortfall Amount, subject to the terms and conditions of the Pooling and
Servicing Agreement.
For purposes of the foregoing, and subject to the following paragraph, the
"Permitted Cure Period" applicable to any Defect or Material Breach in respect
of any Mortgage Loan shall be the 90-day period immediately following the
earlier of the discovery by the Seller or receipt by the Seller of notice of
such Defect or Material Breach, as the case may be; provided that if such Defect
or Material Breach, as the case may be, cannot be corrected or cured in all
material respects within such 90-day period, but is reasonably likely that such
Defect or Material Breach, as the case may be, could be corrected or cured
within 180 days of the earlier of discovery by the Seller and receipt by the
Seller of notice of such Material Documents Defect or Material Breach, as the
case may be, and the Seller is diligently attempting to effect such correction
or cure, then the applicable Permitted Cure Period shall, with the consent of
the Purchaser or its assignee (which consent shall not be unreasonably
withheld), be extended for an additional 90 days.
If the Seller is notified of a defect in any Mortgage File that corresponds
to information set forth in the Mortgage Loan Schedule, the Seller shall
promptly correct such defect and provide a new, corrected Mortgage Loan Schedule
to the Purchaser, which corrected Mortgage Loan Schedule shall be deemed to
amend and replace the existing Mortgage Loan Schedule for all purposes.
(b) Notwithstanding Section 6(a), within 60 days of the earlier of
discovery or receipt of notice by the Seller, from either the Purchaser or any
successor or assign thereof, that any Mortgage Loan does not constitute a
"qualified mortgage" within the meaning of Section 860G(a)(3) of the Code, the
Seller shall repurchase such Mortgage Loan from the then owner(s) thereof at the
applicable Purchase Price by payment of such Purchase Price by wire transfer of
immediately available funds to the account designated by such owner(s).
(c) In connection with any repurchase of or substitution for a Mortgage
Loan contemplated by this Section 6, the then owner(s) thereof shall tender or
cause to be tendered promptly to the Seller, upon delivery of a receipt executed
by the Seller, the related Mortgage File and Servicing File, and each document
that constitutes a part of the Mortgage File that was endorsed or assigned to
the Purchaser or the Trustee shall be endorsed or assigned, as the case may be,
to the Seller in the same manner. The form and sufficiency of all such
instruments and certificates shall be the responsibility of the Seller.
(d) Except as provided in Section 2(b), this Section 6 provides the sole
remedies available to the Purchaser, and its successors and assigns (including,
without limitation, the Trustee and the holders of the Certificates) respecting
any Defect in a Mortgage File or any breach
9
<PAGE>
of any representation or warranty made pursuant to Section 4(a) and set forth in
Exhibit C, or in connection with the circumstances described in Section 6(b). If
the Seller defaults on its obligations to repurchase any Mortgage Loan in
accordance with Section 6(a) or 6(b) or disputes its obligation to repurchase
any Mortgage Loan in accordance with either such subsection, the Purchaser or
its successors and assigns may take such action as is appropriate to enforce
such payment or performance, including, without limitation, the institution and
prosecution of appropriate proceedings. The Seller shall reimburse the Purchaser
for all necessary and reasonable costs and expenses incurred in connection with
such enforcement.
SECTION 7. Closing.
The closing of the sale of the Mortgage Loans (the "Closing") shall be held
at the offices of Orrick, Herrington & Sutcliffe LLP, 666 Fifth Avenue, New
York, New York 10103 at 10:00 a.m., New York City time, on the Closing Date.
The Closing shall be subject to each of the following conditions:
(i) All of the representations and warranties of the Seller specified
herein shall be true and correct as of the Closing Date, and the Aggregate
Cut-off Date Balance shall be within the range permitted by Section 1 of
this Agreement;
(ii) All documents specified in Section 8 (the "Closing Documents"),
in such forms as are agreed upon and acceptable to the Purchaser, shall be
duly executed and delivered by all signatories as required pursuant to the
respective terms thereof;
(iii) The Seller shall have delivered and released to the Trustee, the
Purchaser or the Purchaser's designee, as the case may be, all documents
and funds required to be so delivered pursuant to Section 2;
(iv) The result of any examination of the Mortgage Files and Servicing
Files performed by or on behalf of the Purchaser pursuant to Section 3
shall be satisfactory to the Purchaser in its sole determination;
(v) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with,
and the Seller shall have the ability to comply with all terms and
conditions and perform all duties and obligations required to be complied
with or performed after the Closing Date;
(vi) The Seller shall have paid or agreed to pay all fees, costs and
expenses payable by it to the Purchaser pursuant to this Agreement; and
(vii) Neither the Underwriting Agreement nor the Certificate Purchase
Agreement shall have been terminated in accordance with its terms.
10
<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
Mortgage Loans on the Closing Date.
SECTION 8. Closing Documents.
The Closing Documents shall consist of the following:
(a) This Agreement duly executed and delivered by the Purchaser and the
Seller;
(b) An Officer's Certificate substantially in the form of Exhibit D-1
hereto, executed by the Secretary or an assistant secretary of the Seller, and
dated the Closing Date, and upon which the Purchaser and each Underwriter may
rely, attaching thereto as exhibits the organizational documents of the Seller;
(c) A certificate of good standing regarding the Seller from the Secretary
of State for the State of Maryland, dated not earlier than 30 days prior to the
Closing Date;
(d) A certificate of the Seller substantially in the form of Exhibit D-2
hereto, executed by an executive officer or authorized signatory of the Seller
and dated the Closing Date, and upon which the Purchaser and each Underwriter
may rely;
(e) Written opinions of counsel for the Seller, substantially in the form
of Exhibits D-3A and D-3B hereto and subject to such reasonable assumptions and
qualifications as may be requested by counsel for the Seller and acceptable to
counsel for the Purchaser, dated the Closing Date and addressed to the Purchaser
and each Underwriter;
(f) Any other opinions of counsel for the Seller reasonably requested by
the Rating Agencies in connection with the issuance of the Certificates, each of
which shall include the Purchaser and each Underwriter as an addressee; and
(g) Such further certificates, opinions and documents as the Purchaser may
reasonably request.
SECTION 9. Indemnification.
(a) The Seller agrees to indemnify and hold harmless the Purchaser, its
officers and directors, and each person, if any, who controls the Purchaser
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Securities Exchange Act of 1934, as amended (the "Exchange 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 Securities Act, the Exchange
Act or other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in 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
11
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ABS Term Sheets with respect to the Registered Certificates, or in any revision
or amendment thereof or supplement thereto, or arise out of or are based upon
the omission or alleged omission (in the case of any such Computational
Materials or ABS Term Sheets, when read in conjunction with the Prospectus and,
in the case of the Memorandum, when read together with the other information
specified therein as being available for review by investors) to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in 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 is with respect to information regarding the Mortgage
Loans contained in the Loan Detail or, to the extent consistent therewith, the
Diskette, or (ii) any such untrue statement or alleged untrue statement or
omission or alleged omission is with respect to information regarding the Seller
or the Mortgage Loans contained in the Prospectus Supplement or the Memorandum
under the headings "Summary of Prospectus Supplement - The Mortgage Asset Pool",
"Risk Factors - The Mortgage Loans" and/or "Description of the Mortgage Asset
Pool" or contained on Annex A to the Prospectus Supplement (exclusive of the
Loan Detail), and such information does not represent a restatement or
aggregation of information contained in the Loan Detail; or (iii) such untrue
statement, alleged untrue statement, 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 4; provided, that the indemnification
provided by this Section 9 shall not apply to the extent that such untrue
statement of a material fact or omission of a material fact necessary to make
the statements made, in light of the circumstances in which they were made, not
misleading, was made as a result of an error in the manipulation of, or
calculations based upon, the Loan Detail. This indemnity agreement will be in
addition to any liability which the Seller may otherwise have.
For purposes of the foregoing, "Registration Statement" shall mean the
registration statement No. 333-37717 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 December 17,
1997, as supplemented by the prospectus supplement dated April 28, 1998 (the
"Prospectus Supplement"), relating to the Registered Certificates; "Memorandum"
shall mean the private placement memorandum dated April 28, 1998, relating to
the Non-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"); and "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").
(b) Promptly after receipt by any person entitled to indemnification under
this Section 9 (each, 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")
12
<PAGE>
under this Section 9, notify the indemnifying party in writing of the
commencement thereof; but the omission 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 9. In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and to
the extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof, with counsel satisfactory to such indemnified
party; provided, however, that if the defendants in any such action include both
the indemnified party and the indemnifying party and the indemnified party or
parties shall have reasonably concluded that there may be legal defenses
available to it or them and/or other indemnified parties that are different from
or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert such
legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of its election to assume the
defense of such action and approval by the indemnified party of counsel, which
approval will not be unreasonably withheld, 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
indemnifying party, representing all the indemnified parties under Section 9(a)
who are parties to such action), (ii) the indemnifying party shall not have
employed counsel reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of commencement of
the action or (iii) the indemnifying party has authorized 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 9 is due in
accordance with its terms but is for any reason held by a court to be
unavailable to an indemnified party on grounds of policy or otherwise, 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 9(c) were determined by pro rata
allocation or by any other
13
<PAGE>
method of allocation that does not take account of the considerations referred
to in Section 9(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 9 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 9, 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 Securities 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 9
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by any indemnified
party, and (iii) acceptance of and payment for any of the Certificates.
SECTION 10. Costs.
Costs relating to the transactions contemplated hereby shall be borne by
the respective parties hereto in accordance with the Allocation Agreement.
SECTION 11. Notices.
All demands, notices and communications hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered to or mailed, by
registered mail, postage prepaid, by overnight mail or courier service, or
transmitted by facsimile and confirmed by a similar mailed writing, if to the
Purchaser, addressed to GMAC Commercial Mortgage Securities, Inc. at 650 Dresher
Road, P.O. Box 1015, Horsham, Pennsylvania 19044-8015, Attention: Structured
Finance Manager, facsimile no. (215) 328-1775, with a copy to the General
Counsel, GMAC Commercial Mortgage Corporation, or such other address or
facsimile number as may hereafter be furnished to the Seller in writing by the
Purchaser; and if to the Seller, addressed to German American Capital
Corporation, at 31 W. 52nd Street, New York, New York 10019, Attention: Steven
S. Stuart, facsimile no. (212) 469-7210, or to such other address or facsimile
number as the Seller may designate in writing to the Purchaser.
SECTION 12. Third Party Beneficiaries.
Each of the officers, directors and controlling persons referred to in
Section 9 hereof is an intended third party beneficiary of the covenants and
indemnities of the Seller set forth in Section 9 of this Agreement. It is
acknowledged and agreed that such covenants and indemnities may be
14
<PAGE>
enforced by or on behalf of any such person or entity against the Seller to the
same extent as if it was a party hereto.
SECTION 13. 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 Mortgage Loans by the Seller to the
Purchaser or its designee.
SECTION 14. 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 15. Counterparts.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute
one and the same instrument.
SECTION 16. 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 THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES
EXCEPT THAT THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 17. 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 18. Successors and Assigns.
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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 or other entity resulting from any merger, conversion or
consolidation to which the Seller is a party, or any person succeeding to all or
substantially all of the business of the Seller, shall be the successor to the
Seller hereunder. The Purchaser has the right to assign its interest under this
Agreement, in whole or in part, as may be required to effect the purposes of the
Pooling and Servicing Agreement, and the assignee shall, to the extent of such
assignment, succeed to the rights and obligations hereunder of the Purchaser.
Subject to the foregoing, this Agreement shall bind and inure to the benefit of
and be enforceable by the Seller and the Purchaser, and their permitted
successors and assigns, and the indemnified parties referred to in Section 9.
SECTION 19. Amendments.
No term or provision of this Agreement may be amended, waived, modified or
in any way altered, unless such amendment, waiver, modification or alteration is
in writing and signed by a duly authorized officer of the party against whom
such amendment, waiver, modification or alteration is sought to be enforced. In
addition, this Agreement may not be changed in any manner which would have a
material adverse effect on any third party beneficiary under Section 12 hereof
without the prior consent of that person.
16
<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.
GERMAN AMERICAN CAPITAL
CORPORATION
By: /s/ Kenneth Gilison
-------------------
Name: Kenneth Gilison
Title: Vice President
By: /s/ Robert D. Burns
-------------------
Name: Robert D. Burns
Title: Authorized Signatory
GMAC COMMERCIAL MORTGAGE
SECURITIES, INC.
By: /s/ Elisa George
----------------
Name: Elisa George
Title: Vice President
<PAGE>
EXHIBIT A
MORTGAGE LOAN SCHEDULE
The Mortgage Loan Schedule shall set forth, among other things, the
following information with respect to each Mortgage Loan:
(i) the loan number;
(ii) the street address (including city, state and zip code) of the
related Mortgaged Property;
(iii) the Mortgage Rate in effect as of the Cut-off Date and whether
such Mortgage Loan is an ARM Loan or a Fixed-Rate Loan;
(iv) the original principal balance;
(v) the Cut-off Date Balance;
(vi) the (A) remaining term to stated maturity (B) with respect to
each ARD Loan, the Anticipated Repayment Date and (C) Stated
Maturity Date;
(vii) the Due Date;
(viii) the amount of the Monthly Payment due on the first Due Date
following the Cut-off Date;
(ix) in the case of an ARM Loan, the (A) Index, (B) Gross Margin, (C)
first Mortgage Rate adjustment date following the Cut-off Date
and the frequency of Mortgage Rate adjustments, and (D) maximum
and minimum lifetime Mortgage Rate, if any;
(x) whether such Mortgage Loan is an ARD Loan or a Defeasance Loan;
and
(xi) the Master Servicing Fee Rate.
The Mortgage Loan Schedule shall also set forth the aggregate Cut-off Date
Balance for all of the Mortgage Loans. Such list may be in the form of more than
one list, collectively setting forth all of the information required.
A-1
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EXHIBIT B
THE MORTGAGE FILE
The "Mortgage File" for any Mortgage Loan shall, subject to Section
2(b), collectively consist of the following documents:
(i) the original Mortgage Note, endorsed by the most recent endorsee
prior to the Trustee or, if none, by the originator, without
recourse, either in blank or to the order of the Trustee in the
following form: "Pay to the order of LaSalle National Bank, as
trustee for the registered holders of GMAC Commercial Mortgage
Securities, Inc., Mortgage Pass-Through Certificates, Series
1998-C1, without recourse";
(ii) the original or a copy of the Mortgage and, if applicable, the
originals or copies of any intervening assignments thereof
showing a complete chain of assignment from the originator of
the Mortgage Loan to the most recent assignee of record thereof
prior to the Trustee, if any, in each case with evidence of
recording indicated thereon;
(iii) an original assignment of the Mortgage, in recordable form,
executed by the most recent assignee of record thereof prior to
the Trustee or, if none, by the originator, either in blank or
in favor of the Trustee (in such capacity);
(iv) the original or a copy of the related Assignment of Leases (if
such item is a document separate from the Mortgage) and, if
applicable, the originals or copies of any intervening
assignments thereof showing a complete chain of assignment from
the originator of the Mortgage Loan to the most recent assignee
of record thereof prior to the Trustee, if any, in each case
with evidence of recording thereon;
(v) an original assignment of any related Assignment of Leases (if
such item is a document separate from the Mortgage), in
recordable form, executed by the most recent assignee of record
thereof prior to the Trustee or, if none, by the originator,
either in blank or in favor of the Trustee (in such capacity),
which assignment may be included as part of the corresponding
assignment of Mortgage referred to in clause (iii) above;
(vi) an original or copy of any related security agreement (if such
item is a document separate from the Mortgage) and, if
applicable, the originals or copies of any intervening
assignments thereof showing a complete chain of assignment from
the originator of the Mortgage Loan to the most recent assignee
of record thereof prior to the Trustee, if any;
B-1
<PAGE>
(vii) an original assignment of any related security agreement (if
such item is a document separate from the Mortgage) executed by
the most recent assignee of record thereof prior to the Trustee
or, if none, by the originator, either in blank or in favor of
the Trustee (in such capacity), which assignment may be included
as part of the corresponding assignment of Mortgage referred to
in clause (iii) above;
(viii) originals or copies of all assumption, modification, written
assurance and substitution agreements, with evidence of
recording thereon if appropriate, in those instances where the
terms or provisions of the Mortgage, Mortgage Note or any
related security document have been modified or the Mortgage
Loan has been assumed;
(ix) the original or a copy of the lender's title insurance policy
issued as of the date of the origination of the Mortgage Loan,
together with all endorsements or riders (or copies thereof)
that were issued with or subsequent to the issuance of such
policy, insuring the priority of the Mortgage as a first lien on
the Mortgaged Property;
(x) the original or a copy of any guaranty of the obligations of the
mortgagor under the Mortgage Loan together with (A) if
applicable, the original or copies of any intervening
assignments of such guaranty showing a complete chain of
assignment from the originator of the Mortgage Loan to the most
recent assignee thereof prior to the Trustee, if any, and (B) an
original assignment of such guaranty executed by the most recent
assignee thereof prior to the Trustee or, if none, by the
originator;
(xi) (A) file or certified copies of any UCC financing statements and
continuation statements which were filed in order to perfect
(and maintain the perfection of) any security interest held by
the originator of the Mortgage Loan (and each assignee of record
prior to the Trustee) in and to the personalty of the mortgagor
at the Mortgaged Property (in each case with evidence of filing
thereon) and which were in the possession of the Seller (or its
agent) at the time the Mortgage Files were delivered to the
Trustee and (B) if any such security interest is perfected and
the earlier UCC financing statements and continuation statements
were in the possession of the Seller, a UCC financing statement
executed by the most recent assignee of record prior to the
Trustee or, if none, by the originator, evidencing the transfer
of such security interest, either in blank or in favor of the
Trustee;
(xii) the original or a copy of the power of attorney (with evidence
of recording thereon, if appropriate) granted by the Mortgagor
if the Mortgage,
B-2
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Mortgage Note or other document or instrument referred to above
was signed on behalf of the Mortgagor; and
(xiii) if the Mortgagor has a leasehold interest in the related
Mortgaged Property, the original ground lease or a copy thereof;
provided that whenever the term "Mortgage File" is used to refer to documents
actually received by the Purchaser or the Trustee, such term shall not be deemed
to include such documents and instruments required to be included therein unless
they are actually so received. The original assignments referred to in clauses
(iii), (v), (vii) and (x)(B), may be in the form of one or more instruments in
recordable form in any applicable filing offices.
B-3
<PAGE>
EXHIBIT C
REPRESENTATIONS AND WARRANTIES OF THE SELLER
REGARDING THE INDIVIDUAL MORTGAGE LOANS
With respect to each Mortgage Loan, the Seller hereby represents and
warrants, as of the date hereinbelow specified or, if no such date is specified,
as of the Closing Date, except as set forth on Schedule C-1 hereto, that:
(i) Ownership of Mortgage Loans. Immediately prior to the transfer
thereof to the Purchaser, the Seller had good and marketable title to, and was
the sole owner and holder of, such Mortgage Loan, free and clear of any and all
liens, encumbrances and other interests on, in or to such Mortgage Loan (other
than, in certain cases, the right of a subservicer to directly service such
Mortgage Loan). Such transfer validly assigns ownership of such Mortgage Loan to
the Purchaser free and clear of any pledge, lien, encumbrance or security
interest.
(ii) Authority to Transfer Mortgage Loans. The Seller has full right and
authority to sell, assign and transfer such Mortgage Loan. 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.
(iii) Mortgage Loan Schedule. The information pertaining to such
Mortgage Loan set forth in the Mortgage Loan Schedule was true and correct in
all material respects as of the Cut-off Date.
(iv) Payment Record. Such Mortgage Loan was not as of the Cut-off Date,
and has not been during the twelve-month period prior thereto, 30 days or more
delinquent in respect of any debt service payment required thereunder, without
giving effect to any applicable grace period.
(v) Permitted Encumbrances. The related Mortgage constitutes a valid
first lien upon the related Mortgaged Property, including all buildings located
thereon and all fixtures attached thereto, such lien being subject only to (A)
the lien of current real property taxes and assessments not yet due and payable,
(B) covenants, conditions and restrictions, rights of way, easements and other
matters of public record, and (C) exceptions and exclusions specifically
referred to in the lender's title insurance policy issued or, as evidenced by a
"marked-up" commitment, to be issued in respect of such Mortgage Loan (the
exceptions set forth in the foregoing clauses (A), (B) and (C) collectively,
"Permitted Encumbrances"). The Permitted Encumbrances do not materially
interfere with the security intended to be provided by the related Mortgage, the
current use or operation of the related Mortgaged Property or the current
ability of the Mortgaged Property to generate net operating income sufficient to
service the Mortgage Loan. If the Mortgaged Property is operated as a nursing
facility, a hospitality property or a multifamily
C-1
<PAGE>
property, the Mortgage, together with any separate security agreement, similar
agreement and UCC financing statement, if any, establishes and creates a first
priority, perfected security interest, to the extent such security interest can
be perfected by the recordation of a Mortgage or the filing of a UCC financing
statement, in all personal property owned by the Mortgagor that is used in, and
is reasonably necessary to, the operation of the related Mortgaged Property.
(vi) Title Insurance. The lien of the related Mortgage is insured by an
ALTA lender's title insurance policy ("Title Policy"), or its equivalent as
adopted in the applicable jurisdiction, issued by a nationally recognized title
insurance company, insuring the originator of such Mortgage Loan, its successors
and assigns, as to the first priority lien of the Mortgage in the original
principal amount of the Mortgage Loan after all advances of principal, subject
only to Permitted Encumbrances (or, if a title insurance policy has not yet been
issued in respect of the Mortgage Loan, a policy meeting the foregoing
description is evidenced by a commitment for title insurance "marked-up" at the
closing of such loan). Each Title Policy (or, if it has yet to be issued, the
coverage to be provided thereby) is in full force and effect, all premiums
thereon have been paid and, to the Seller's knowledge, no material claims have
been made thereunder and no claims have been paid thereunder. The Seller has
not, by act or omission, done anything that would materially impair the coverage
under such Title Policy. Immediately following the transfer and assignment of
the related Mortgage Loan to the Trustee, such Title Policy (or, if it has yet
to be issued, the coverage to be provided thereby) will inure to the benefit of
the Trustee without the consent of or notice to the insurer. To the Seller's
actual knowledge, the insurer that issued such Title Policy is qualified to do
business in the state in which the related Mortgaged Property is located,
(vii) No Waivers by Seller of Material Defaults. The Seller has not
waived any material default, breach, violation or event of acceleration existing
under the related Mortgage or Mortgage Note.
(viii) No Offsets, Defenses or Counterclaims. There is no valid offset,
defense or counterclaim to such Mortgage Loan.
(ix) Condition of Property; Condemnation. Except as set forth in any
engineering report prepared in connection with the origination of (or obtained
in connection with or otherwise following the Seller's acquisition of) such
Mortgage Loan, the related Mortgaged Property is, to the Seller's knowledge,
free and clear of any damage that would materially and adversely affect its
value as security for such Mortgage Loan. The Seller has no actual notice of the
commencement of a proceeding for the condemnation of all or any material portion
of the related Mortgaged Property.
(x) Compliance with Usury Laws. Such Mortgage Loan complied with all
applicable usury laws in effect at its date of origination.
(xi) Full Disbursement of Mortgage Loan Proceeds. The proceeds of such
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Mortgage Loan have been fully disbursed and there is no requirement for future
advances thereunder.
(xii) Enforceability. The related Mortgage Note and Mortgage and all
other documents and instruments evidencing, guaranteeing, insuring or otherwise
securing such Mortgage Loan have been duly and properly executed by the parties
thereto, and each is the legal, valid and binding obligation of the maker
thereof (subject to any non-recourse provisions contained in any of the
foregoing agreements and any applicable state anti-deficiency legislation),
enforceable in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, receivership, moratorium or
other laws relating to or affecting the rights of creditors generally and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(xiii) Insurance. All improvements upon the related Mortgaged Property
are insured against loss by hazards of extended coverage in an amount (subject
to a customary deductible) at least equal to the lesser of the outstanding
principal balance of such Mortgage Loan and 100% of the full replacement cost of
the improvements located on such Mortgaged Property and the related hazard
insurance policy contains appropriate endorsements to avoid the application of
co-insurance and does not permit reduction in insurance proceeds for
depreciation. If any portion of the related Mortgaged Property was, at the time
of the origination of such Mortgage Loan, in an area identified in the Federal
Register by the Federal Emergency Management Agency as having special flood
hazards, and flood insurance was available, a flood insurance policy meeting any
requirements of the then current guidelines of the Federal Insurance
Administration is in effect with a generally acceptable insurance carrier, in an
amount representing coverage not less than the least of (1) the outstanding
principal balance of such Mortgage Loan, (2) the full insurable value of such
Mortgaged Property, (3) the maximum amount of insurance available under the
National Flood Insurance Act of 1968, as amended, and (4) 100% of the
replacement cost of the improvements located on such Mortgaged Property. In
addition, the Mortgage requires the Mortgagor to maintain in respect of the
Mortgaged Property comprehensive general liability insurance in amounts
generally required by the Seller, and at least six months rental or business
interruption insurance, and all such insurance required by the Mortgage to be
maintained is in full force and effect. Each such insurance policy requires
prior notice to the holder of the Mortgage of termination or cancellation, and
no such notice has been received, including any notice of nonpayment of
premiums, that has not been cured.
(xiv) Environmental Condition. The related Mortgaged Property was
subject to one or more environmental site assessments (or an update of a
previously conducted assessment), which was (were) performed on behalf of the
Seller, or as to which the related report was delivered to the Seller in
connection with its origination or acquisition of such Mortgage Loan; and the
Seller, having made no independent inquiry other than reviewing the resulting
report(s) and/or employing an environmental consultant to perform the
assessment(s) referenced herein, has no knowledge of any material and adverse
environmental conditions or circumstance affecting such Mortgaged Property that
was not disclosed in the related report(s). The Seller has not taken
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any action with respect to such Mortgage Loan or the related Mortgaged Property
that could subject the Purchaser, or its successors and assigns in respect of
the Mortgage Loan, to any liability under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended ("CERCLA") or any
other applicable federal, state or local environmental law, and the Seller has
not received any actual notice of a material violation of CERCLA or any
applicable federal, state or local environmental law with respect to the related
Mortgaged Property that was not disclosed in the related report. The related
Mortgage or loan documents in the related Mortgage File requires the Mortgagor
to comply with all applicable federal, state and local environmental laws and
regulations.
(xv) No Cross-Collateralization with Other Mortgage Loans. Such Mortgage
Loan is not cross-collateralized with any mortgage loan that will not be
included in the Trust Fund.
(xvi) Waivers and Modifications. The terms of the related Mortgage and
the Mortgage Note have not been impaired, waived, altered or modified in any
material respect, except as specifically set forth in the related Mortgage File.
(xvii) Taxes and Assessments. There are no delinquent taxes, ground
rents, assessments for improvements or other similar outstanding charges
affecting the related Mortgaged Property which are or may become a lien of
priority equal to or higher than the lien of the related Mortgage. For purposes
of this representation and warranty, real property taxes and assessments shall
not be considered unpaid until the date on which interest and/or penalties would
be payable thereon.
(xviii) Mortgagor's Interest in Mortgaged Property. Except in the case
of one Mortgage Loan as to which the interest of the related Mortgagor in the
related Mortgaged Property is in whole or in part a leasehold estate the
interest of the related Mortgagor in the related Mortgaged Property consists of
a fee simple estate in real property.
(xix) Whole Loan. Each Mortgage Loan is a whole loan and not a
participation interest.
(xx) Valid Assignment. The assignment of the related Mortgage referred
to in clause (iii) of Exhibit B constitutes the legal, valid and binding
assignment of such Mortgage from the relevant assignor to the Trustee. The
Assignment of Leases set forth in the Mortgage or separate from the related
Mortgage and related to and delivered in connection with each Mortgage Loan
establishes and creates a valid, subsisting and, subject only to Permitted
Encumbrances, enforceable first priority lien and first priority security
interest in the related Mortgagor's interest in all leases, subleases, licenses
or other agreements pursuant to which any person is entitled to occupy, use or
possess all or any portion of the real property subject to the related Mortgage,
and each assignor thereunder has the full right to assign the same. The related
assignment of any Assignment of Leases, not included in a Mortgage, executed and
delivered in favor of the Trustee
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is in recordable form and constitutes a legal, valid and binding assignment,
sufficient to convey to the assignee named therein all of the assignor's right,
title and interest in, to and under such Assignment of Leases.
(xxi) Escrows. All escrow deposits relating to such Mortgage Loan that
are, as of the Closing Date, required to be deposited with the mortgagee or its
agent have been so deposited.
(xxii) No Mechanics' or Materialmen's Liens. As of the date of
origination of such Mortgage Loan and, to the actual knowledge of the Seller, as
of the Closing Date, the related Mortgaged Property was and is free and clear of
any mechanics' and materialmen's liens or liens in the nature thereof which
create a lien prior to that created by the related Mortgage, except those which
are insured against by the Title Policy referred to in (vi) above.
(xxiii) No Material Encroachments. 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 any material
extent (unless affirmatively covered by the title insurance referred to in
paragraph (vi) above), and no improvements on adjoining properties encroached
upon such Mortgaged Property to any material extent. To the Seller's knowledge,
based upon opinions of counsel and/or other due diligence customarily performed
by the Seller, the improvements located on or forming part of such Mortgaged
Property comply in all material respects with applicable zoning laws and
ordinances (except to the extent that they may constitute legal non-conforming
uses).
(xxiv) Originator Authorized. 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.
(xxv) No Material Default. (A) To the Seller's knowledge, there exists
no material default, breach or event of acceleration under the related Mortgage
or Mortgage Note, and (B) the Seller has not received actual notice of any event
(other than payments due but not yet delinquent) that, with the passage of time
or with notice and the expiration of any grace or cure period, would constitute
such a material default, breach or event of acceleration; provided, however,
that this representation and warranty does not cover any default, breach or
event of acceleration that specifically pertains to any matter otherwise covered
or addressed by any other representation and warranty made by the Seller herein.
(xxvi) Inspection. In connection with the origination or acquisition of
each Mortgage Loan, the Seller inspected or caused to be inspected the Mortgaged
Property.
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(xxvii) No Equity Participation or Contingent Interest. The Mortgage
Loan contains no equity participation by the lender, and does not provide for
any contingent or additional interest in the form of participation in the cash
flow of the related Mortgaged Property, or for negative amortization.
(xxviii) No Advances of Funds. No holder of the Mortgage Loan has, to
the Seller's knowledge, advanced funds or induced, solicited or knowingly
received any advance of funds from a party other than the owner of the related
Mortgaged Property, directly or indirectly, for the payment of any amount
required by the Mortgage Loan.
(xxix) Licenses, Permits, Etc. To the Seller's knowledge, based on due
diligence customarily performed in the origination of comparable mortgage loans
by the Seller, as of the date of origination of the Mortgage Loan, the related
Mortgagor or operator of the related Mortgaged Property was in possession of all
material licenses, permits and authorizations required by applicable laws for
the ownership and operation of the related Mortgaged Property as it was then
operated and if a related Mortgaged Property is improved by a skilled nursing,
congregate care or assisted living facility, the most recent inspection or
survey by governmental authorities having jurisdiction in connection with such
licenses, permits and authorizations did not cite such Mortgaged Property for
material violations (which shall include only "Level A" (or equivalent)
violations in the case of skilled nursing facilities) that had not been cured or
as to which a plan of correction had not been submitted to and accepted by such
governmental authorities. To the extent such facility participates in Medicaid
or Medicare, such facility is in compliance in all material respects with the
requirements of such program.
(xxx) Servicing. The servicing and collection practices used with
respect to the Mortgage Loan have complied with applicable law in all material
respects and are consistent with the servicing standard set forth in Section
3.01(a) of the Pooling and Servicing Agreement.
(xxxi) Customary Remedies. The related Mortgage or Mortgage Note,
together with applicable state law, contains customary and enforceable
provisions (subject to the exceptions set forth in paragraph (xii)) such as to
render the rights and remedies of the holders thereof adequate for the practical
realization against the related Mortgaged Property of the principal benefits of
the security intended to be provided thereby.
(xxxii) Insurance and Condemnation Proceeds. The related Mortgage
provides that insurance proceeds and condemnation proceeds will be applied
either to restore or repair the Mortgaged Property, or to repay the principal of
the Mortgage Loan or otherwise at the option of the holder of the Mortgage.
(xxxiii) LTV. The gross proceeds of each Mortgage Loan to the related
Mortgagor at origination did not exceed the non-contingent principal amount of
the Mortgage Loan and either: (A) such Mortgage Loan is secured by an interest
in real property having a fair market value (1) at the date the Mortgage Loan
was originated at least equal to 80 percent of the original principal balance of
the Mortgage Loan or (2) at the Closing Date at least equal to 80 percent of the
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principal balance of the Mortgage Loan on such date; provided that for purposes
hereof, the fair market value of the real property interest must first be
reduced by (X) the amount of any lien on the real property interest that is
senior to the Mortgage Loan and (Y) a proportionate amount of any lien that is
in parity with the Mortgage Loan (unless such other lien secures a Mortgage Loan
that is cross-collateralized with such Mortgage Loan, in which event the
computation described in clauses (1) and (2) of this paragraph (xxxiii) shall be
made on a pro rata basis in accordance with the fair market values of the
Mortgaged Properties securing such cross-collateralized Mortgage Loans; or (B)
substantially all the proceeds of such Mortgage Loan were used to acquire,
improve or protect the real property which served as the only security for such
Mortgage Loan (other than a recourse feature or other third party credit
enhancement within the meaning of Treasury Regulations Section
1.860G-2(a)(1)(ii)).
(xxxiv) LTV and Significant Modifications. If the Mortgage Loan was
"significantly modified" prior to the Closing Date so as to result in a taxable
exchange under Section 1001 of the Code, it either (A) was modified as a result
of the default or reasonably foreseeable default of such Mortgage Loan or (B)
satisfies the provisions of either clause (A)(1) of paragraph (xxxiii)
(substituting the date of the last such modification for the date the Mortgage
Loan was originated) or clause (A)(2) of paragraph (xxxiii), including the
proviso thereto.
(xxxv) [Reserved.]
(xxxvi) Litigation. 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) Leasehold Estate. Each Mortgaged Property consists of the
related Mortgagor's fee simple estate in real estate or, if the related Mortgage
Loan is secured in whole or in part by the interest of a Mortgagor as a lessee
under a ground lease of a Mortgaged Property (a "Ground Lease"), by the related
Mortgagor's interest in the Ground Lease but not by the related fee interest in
such Mortgaged Property (the "Fee Interest") or if the Mortgage Loan is secured
in whole or in part by a Ground Lease and a Fee Interest, either (1) the ground
lessor's fee interest is subordinated to the lien of the Mortgage or (2) the
following apply to such Ground Lease:
(a) To the actual knowledge of the Seller, such Ground Lease or a
memorandum thereof has been or will be duly recorded; such
Ground Lease (or the related estoppel letter or lender
protection agreement between the Seller and related lessor)
permits the interest of the lessee thereunder to be encumbered
by the related Mortgage; and there has been no material change
in the payment terms of such Ground Lease since the origination
of the related Mortgage Loan,
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with the exception of material changes reflected in written
instruments that are a part of the related Mortgage File;
(b) The lessee's interest in such Ground Lease is not subject to any
liens or encumbrances superior to, or of equal priority with,
the related Mortgage, other than the ground lessor's related fee
interest and Permitted Encumbrances;
(c) The Mortgagor's interest in such Ground Lease is assignable to
the Purchaser and its successors and assigns upon notice to, but
without the consent of, the lessor thereunder (or, if 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 Purchaser and its successors and assigns upon
notice to, but without the need to obtain the consent of, such
lessor;
(d) Such Ground Lease is in full force and effect, and the Seller
has received no notice that an event of default has occurred
thereunder, and, to the Seller's actual knowledge, there exists
no condition that, but for the passage of time or the giving of
notice, or both, would result in an event of default under the
terms of such Ground Lease;
(e) Such Ground Lease, or an estoppel letter or other agreement,
requires the lessor under such Ground Lease to give notice of
any default by the lessee to the mortgagee, provided that the
mortgagee has provided the lessor with notice of its lien in
accordance with the provisions of such Ground Lease, and such
Ground Lease, or an estoppel letter or other agreement, further
provides that no notice of termination given under such Ground
Lease is effective against the mortgagee unless a copy has been
delivered to the mortgagee;
(f) A mortgagee is permitted a reasonable opportunity (including,
where necessary, sufficient time to gain possession of the
interest of the lessee under such Ground Lease) to cure any
default under such Ground Lease, which is curable after the
receipt of notice of any such default, before the lessor
thereunder may terminate such Ground Lease;
(g) Such Ground Lease has an original term (including any extension
options set forth therein) which extends not less than ten years
beyond the Stated Maturity Date of the related Mortgage Loan;
(h) Under the terms of such Ground Lease and the related Mortgage,
taken together, any related insurance proceeds other than in
respect of a total or substantially total loss or taking, will
be applied either to the repair or restoration of all or part of
the related Mortgaged Property, with the mortgagee or a trustee
appointed by it having the right to hold and disburse
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such proceeds as the repair or restoration progresses (except in
such cases where a provision entitling another party to hold and
disburse such proceeds would not be viewed as commercially
unreasonable by a prudent commercial mortgage lender), or to the
payment of the outstanding principal balance of the Mortgage
Loan together with any accrued interest thereon; and
(i) Such Ground Lease does not impose any restrictions on subletting
which would be viewed, as of the date of origination of the
related Mortgage Loan, as commercially unreasonable by the
Seller; and such Ground Lease contains a covenant that the
lessor thereunder is not permitted, in the absence of an uncured
default, to disturb the possession, interest or quiet enjoyment
of any subtenant of the lessee, or in any manner, which would
materially adversely affect the security provided by the related
Mortgage.
(j) Such Ground Lease requires the lessor to enter into a new lease
in the event of a termination of the Ground Lease by reason of a
default by the Mortgagor under the Ground Lease, including,
rejection of the ground lease in a bankruptcy proceeding.
(xxxviii) Deed of Trust. 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.
(xxxix) Lien Releases. Except in cases where either (a) a release of a
portion of the Mortgaged Property was contemplated at origination of the
Mortgage Loan and such portion was not considered material for purposes of
underwriting the Mortgage Loan or (b) release is conditioned upon the
satisfaction of certain underwriting and legal requirements and the payment of a
release price, the related Mortgage Note or Mortgage does not require the holder
thereof to release all or any portion of the Mortgaged Property from the lien of
the related Mortgage except upon payment in full of all amounts due under such
Mortgage Loan.
(xl) Junior Liens. The Mortgage Loan does not permit the related
Mortgaged Property to be encumbered by any lien junior to or of equal priority
with the lien of the related Mortgage without the prior written consent of the
holder thereof or the satisfaction of debt service coverage or similar
conditions specified therein.
(xli) Mortgagor Bankruptcy. To the Seller's knowledge, the Mortgagor is
not a debtor in any state or federal bankruptcy or insolvency proceeding.
(xlii) Due Organization of Mortgagors. As of the date of origination of
each Mortgage, each related Mortgagor which is not a natural person was duly
organized and validly existing under the laws of the state of its jurisdiction.
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(xliii) Due-On-Sale. The Mortgage Loan contains provisions for the
acceleration of the payment of the unpaid principal balance of such Mortgage
Loan if, without complying with the requirements of such Mortgage Loan, the
related Mortgaged Property, or any controlling interest therein, is directly or
indirectly transferred or sold.
(xliv) Single Purpose Entity. Except for those Mortgage Loans identified
on Schedule C-1 hereto which represent 4.45% of the Mortgage Loans by Cut-Off
Date Principal Balance, the Mortgagor is an entity, other than an individual,
whose organizational documents or the related Mortgage Loan Documents provide
substantially to the effect that the Mortgagor: (a) is formed or organized
solely for the purpose of owning and operating one or more of the Mortgaged
Properties securing the Mortgage Loans, (b) may not engage in any business
unrelated to such Mortgaged Property or Mortgaged Properties, (c) does not have
any assets other than those related to its interest in and operation of such
Mortgage Property or Mortgaged Properties, (d) may not incur indebtedness other
than as permitted by the related Mortgage or other Mortgage Loan Documents, (e)
has its own books and records separate and apart from any other person, and (f)
holds itself out as a legal entity, separate and apart from any other person.
(xlvi) Defeasance Provisions. Any Mortgage Loan which contains a
provision for any defeasance of mortgage collateral either (A) requires the
consent of the holder of the Mortgage Loan to any defeasance, or (B) permits
defeasance (i) no earlier than two years after the Closing Date (as defined in
the Pooling and Servicing Agreement, dated as of May 1, 1998), (ii) only with
substitute collateral constituting "government securities" within the meaning of
Treas. Reg. ss. 1.860G-2(a)(8)(i), and (iii) only to facilitate the disposition
of mortgage real property and not as a part of an arrangement to collateralize a
REMIC offering with obligations that are not real estate mortgages.
It is understood and agreed that the representations and warranties set
forth in this Exhibit C shall survive delivery of the respective Mortgage Files
to the Purchaser and/or the Trustee and shall inure to the benefit of the
Purchaser, and its successors and assigns (including without limitation the
Trustee and the holders of the Certificates), notwithstanding any restrictive or
qualified endorsement or assignment.
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SCHEDULE C-1 to EXHIBIT C
REPRESENTATIONS AND WARRANTIES EXCEPTIONS
1. CCRT Properties, L.P. (Grossmont Trolley) - TA1585
a) (ii) and (xx). In order for Seller to assign its interest in that
certain Assignment of License Agreement for Parking, Seller must
notify the San Diego Metropolitan Transit Development Board of the
assignment and must notify its assignee of the obligation to notify
San Diego Metropolitan Transit Development Board of any future
assignments. In order for assignees to take over Seller's interest,
they are subject to both the rights and the obligations under the
Assignment.
b) (xiii). Insurance must be maintained pursuant to the guidelines set
forth in provision (xiii), however the Deed of Trust sets forth that
the insurance may be maintained by either the Mortgagor or their
tenants.
c) (xxxvii). Mortgagor ground leases the property to a Ground Lessee. The
Ground Lessee in turn ground leases the property back to Mortgagor
pursuant to three separate Ground Subleases. This Loan is secured by
(i) a fee interest in the property and (ii) Mortgagor's interest in
the three Ground Subleasehold Estates on the property. The Mortgagor's
interest in the Ground Subleases is subject to the Ground Lessee's
interest in the Ground Lease and the Mortgage/Deed of Trust in the fee
is subject to the Ground Lease. Our responses are with respect to
Mortgagor's Ground Subleasehold interest.
i) Mortgagor is the Ground Lessor and the lien encumbers its fee
interest.
ii) Provision (g) of Section (xxxvii) is not true. The Ground
Lease and the underlying Ground Subleases expire in 2016, 12
years before the Maturity Date of the Mortgage Loan. However,
the Mortgage Loan will continue to be secured by a lien on the
fee estate, after the expiration of the Ground Lease and
Ground Subleases.
iii) In regards to provision (i) of section (xxxvii), the Ground
Subleases do not specifically contain a covenant that the
Ground Sublessor is not permitted to disturb the possession or
interest of any subtenants of the Ground Sublessee, in any
manner, which would materially adversely affect the security
provided by the Mortgage.
2. Westwood Investments L.P. (Hilgard House Hotel) - TA1658
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(xliv). Westwood Investments L.P. is not a single purpose entity.
3. Aloha Mobile Home Park, LLC (Aloha Mobile Home) - TA0541
(xliv). Aloha Mobile Home Park, LLC is not a single purpose entity.
4. Women's National Republican Club - TA1799
(xliv). Women's National Republican Club is not a single purpose
entity.
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EXHIBIT D-1
FORM OF CERTIFICATE OF AN OFFICER OF
THE SELLER
Certificate of Officer of German American Capital Corporation ("GACC")
I, _________________, a _________________ of GACC (the "Seller"), hereby
certify as follows:
The Seller is a corporation duly organized and validly existing under the
laws of the State of Maryland.
Attached hereto as Exhibit I are true and correct copies of the Certificate
of Incorporation and By-Laws of the Seller, which Certificate of Incorporation
and By-Laws are on the date hereof, and have been at all times in full force and
effect.
To the best of my knowledge, no proceedings looking toward liquidation or
dissolution of the Seller are pending or contemplated.
Each person listed below is and has been the duly elected and qualified
officer or authorized signatory of the Seller and his genuine signature is set
forth opposite his name:
Name Office Signature
Each person listed above who signed, either manually or by facsimile
signature, the Mortgage Loan Purchase Agreement, dated April 28, 1998 (the
"Purchase Agreement"), between the Seller and GMAC Commercial Mortgage
Securities, Inc. providing for the purchase by GMAC Commercial Mortgage
Securities, Inc. from the Seller of the Mortgage Loans, was, at the respective
times of such signing and delivery, duly authorized or appointed to execute such
documents in such capacity, and the signatures of such persons or facsimiles
thereof appearing on such documents are their genuine signatures.
Capitalized terms not otherwise defined herein have the meanings assigned
to them in the Purchase Agreement.
D-1-1
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed this certificate as of
_______ __, 1998.
By:______________________________
Name:
Title:
I, [name], [title], hereby certify that ________________ is a duly elected
or appointed, as the case may be, qualified and acting ______________ of the
Seller and that the signatures appearing above is her genuine signatures.
IN WITNESS WHEREOF, the undersigned has executed this certificate as of
_______ __, 1998.
By:______________________________
Name:
Title:
D-1-2
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EXHIBIT D-2
FORM OF CERTIFICATE OF THE SELLER
Certificate of German American Capital Corporation
In connection with the execution and delivery by German American Capital
Corporation (the "Seller") of, and the consummation of the transaction
contemplated by, that certain Mortgage Loan Purchase Agreement, dated as of
April 28, 1998 (the "Purchase Agreement"), between GMAC Commercial Mortgage
Securities, Inc. and the Seller, the Seller hereby certifies that (i) the
representations and warranties of the Seller in the Purchase Agreement are true
and correct in all material respects at and as of the date hereof with the same
effect as if made on the date hereof, and (ii) the Seller has, in all material
respects, complied with all the agreements and satisfied all the conditions on
its part to be performed or satisfied at or prior to the date hereof.
Capitalized terms not otherwise defined herein have the meanings assigned to
them in the Purchase Agreement.
Certified this ___th day of _______, 1998.
GERMAN AMERICAN CAPITAL
CORPORATION
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
D-2-1
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EXHIBIT D-3A
FORM OF OPINION I OF COUNSEL TO THE SELLER
May [__], 1998
[GMAC Commercial Mortgage Securities, Inc.]
[Underwriters]
[Rating Agencies]
[Trustee]
Re: GMAC Commercial Mortgage Corporation, Mortgage Pass-Through Certificates,
Series 1998-C1
Ladies and Gentlemen:
I am General Counsel to German American Capital Corporation (the "Seller").
In that capacity, I am familiar with the issuance of certain Mortgage
Pass-Through Certificates, Series 1998-C1 (the "Certificates"), evidencing
undivided interests in a trust fund (the "Trust Fund") consisting primarily of
certain mortgage loans (the "Mortgage Loans"), pursuant to a Pooling and
Servicing Agreement, dated as of May 1, 1998 (the "Pooling and Servicing
Agreement"), among GMAC Commercial Mortgage Securities, Inc. as depositor (the
"Depositor"), GMAC Commercial Mortgage Corporation ("GMACCM") as master servicer
and special servicer, LaSalle National Bank as trustee (the "Trustee") and ABN
AMRO Bank N.V. as fiscal agent.
Certain of the Mortgage Loans were purchased by the Depositor from the
GMACCM, pursuant to, and for the consideration described in, the Mortgage Loan
Purchase Agreement, dated as of April 28, 1998 (the "GMACCM Mortgage Loan
Purchase Agreement"), between the Depositor and GMACCM. Certain of the Mortgage
Loans were purchased by the Depositor from German American Capital Corporation
("GACC"), pursuant to, and for the consideration described in, the Mortgage Loan
Purchase Agreement, dated as of April 28, 1998 (the "GACC Mortgage Loan Purchase
Agreement"), between GACC and the Depositor. The GACC Mortgage Loan Purchase
Agreement is referred to herein as the "Agreement." Capitalized terms not
defined herein have the meanings set forth in the Pooling and Servicing
Agreement and the Agreement. This opinion is rendered pursuant to Section 8(e)
of the GACC Mortgage Loan Purchase Agreement.
D-3A-1
<PAGE>
The Depositor has sold the Class X, Class A-1, Class A-2, Class B, Class C,
Class D, Class E and Class F Certificates (collectively, the "Publicly Offered
Certificates") to the underwriters pursuant to the Underwriting Agreement, dated
as of April 28, 1998 (the "Underwriting Agreement"), among the Depositor,
GMACCM, and the underwriters named therein and sold the Class G, Class H, Class
J, Class K, Class L, Class M, Class N, Class R-I, Class R-II and Class R-III
Certificates (collectively, the "Privately Offered Certificates") to Deutsche
Morgan Grenfell Inc. and Lehman Brothers Inc. as initial purchasers pursuant to
the Certificate Purchase Agreement, dated as of April 28, 1998 (the "Certificate
Purchase Agreement"), among the Depositor, GMACCM and initial purchasers.
In connection with rendering this opinion letter, I have examined or have
caused persons under my supervision to examine the Agreement and such other
records and other documents as I have deemed necessary. I have further assumed
that there is not and will not be any other agreement that materially
supplements or otherwise modifies the agreements expressed in the Agreement. As
to matters of fact, I have examined and relied upon representations of parties
contained in the Agreement and, where I have deemed appropriate, representations
and certifications of officers of the Depositor, the Seller, the Trustee, other
transaction participants or public officials. I have assumed the authenticity of
all documents submitted to me as originals, the genuineness of all signatures
other than officers of the Seller and the conformity to the originals of all
documents submitted to me as copies. I have assumed that all parties, except for
the Seller, had the corporate power and authority to enter into and perform all
obligations thereunder. As to such parties, I also have assumed the due
authorization by all requisite corporate action, the due execution and delivery
and the enforceability of such documents. I have further assumed the conformity
of the Mortgage Loans and related documents to the requirements of the
Agreement.
In rendering this opinion letter, I do not express any opinion concerning
any law other than the law of the State of New York, the General Corporation Law
of the State of Delaware and the federal law of the United States, and I do not
express any opinion concerning the application of the "doing business" laws or
the securities laws of any jurisdiction other than the federal securities laws
of the United States. To the extent that any of the matters upon which I am
opining herein are governed by laws ("Other Laws") other than the laws
identified in the preceding sentence, I have assumed with your permission and
without independent verification or investigation as to the reasonableness of
such assumption, that such Other Laws and judicial interpretation thereof do not
vary in any respect material to this opinion from the corresponding laws of the
State of New York and judicial interpretations thereof. I do not express any
opinion on any issue not expressly addressed below.
Based upon the foregoing, I am of the opinion that:
1. The Seller is duly incorporated and is validly existing as a corporation in
good standing under the laws of the State of Maryland and has the requisite
power and authority,
D-3A-2
<PAGE>
corporate or other, to own its properties and conduct its business, as
presently conducted by it, and to enter into and perform its obligations
under the Agreement.
2. The Agreement has been duly and validly authorized, executed and delivered
by the Seller and, upon due authorization, execution and delivery by the
other parties thereto, will constitute the valid, legal and binding
agreements of the Seller enforceable against the Seller in accordance with
their terms, except as enforceability may be limited by (i) bankruptcy,
insolvency, liquidation, receivership, moratorium, reorganization or other
similar laws affecting the rights of creditors, (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 the Agreement which purport to provide indemnification
with respect to securities law violations.
3. No consent, approval, authorization or order or federal court or
governmental agency or body is required for the consummation by the Seller
of the transactions contemplated by the terms of the Agreement, except for
those consents, approvals, authorizations or orders which previously have
been obtained.
4. Neither the consummation of any of the transactions contemplated by, nor
the fulfillment by the Seller of any other of the terms of, the Agreement,
will result in a material breach of any term or provision of the charter or
bylaws of the Seller or any state or federal statute or regulation or
conflict with, result in a material breach, violation or acceleration of or
constitute a material default under the terms of any indenture or other
material agreement or instrument to which the Seller is a party or by which
it is bound or any order or regulation of any state or federal court,
regulatory body, administrative agency or governmental body having
jurisdiction over the Seller.
This opinion letter is rendered for the sole benefit of each addressee
hereof, and no other person or entity is entitled to rely hereon without my
prior written consent. Copies of this opinion letter may not be furnished to any
other person or entity, nor may any portion of this opinion letter be quoted,
circulated or referred to in any other document without my prior written
consent.
Very truly yours,
D-3A-3
<PAGE>
EXHIBIT D-3B
FORM OF OPINION II OF COUNSEL TO THE SELLER
May [__], 1998
[GMAC Commercial Mortgage Corporation]
[GMAC Commercial Mortgage Securities, Inc.]
[Underwriters]
Re: GMAC Commercial Mortgage Corporation, Mortgage Pass-Through Certificates,
Series 1998-C1
Ladies and Gentlemen:
This opinion is being provided to you by the undersigned, as special
counsel to German American Capital Corporation ("GACC"), pursuant to Section
8(e) of the Mortgage Loan Purchase Agreement, dated April 28, 1998 (the "GACC
Mortgage Loan Purchase Agreement"), between GMAC Commercial Mortgage Securities,
Inc. (the "Purchaser") and GACC as the Seller, (in such capacity the "Seller"),
relating to the sale by the Seller of certain mortgage loans (the "Mortgage
Loans"), and pursuant to Section 6.11 of the Underwriting Agreement, dated as of
April 28, 1998, between the Purchaser and Deutsche Morgan Grenfell Inc. and
Lehman Brothers Inc., relating to that certain Pooling and Servicing Agreement,
dated as of May 1, 1998, among GMAC Commercial Mortgage Corporation ("GMACCM")
as special servicer and master servicer (in such respective capacities, the
"Special Servicer" and the "Master Servicer"), the Purchaser, LaSalle National
Bank, as trustee and ABN AMRO Bank N.V. as fiscal agent (the "Pooling and
Servicing Agreement" and together with the GACC Mortgage Loan Purchase
Agreement, the "Agreements"). Capitalized terms not otherwise defined herein
have the meanings assigned to them in the Agreements.
In rendering this opinion, we have examined and relied upon executed copies
of the Agreements and originals or copies, certified or otherwise identified to
our satisfaction, of such certificates and other documents as we have deemed
appropriate for the purposes of rendering this opinion. We have examined and
relied upon, among other things, the documents and opinions delivered to you at
the closing being held today relating to the Certificates, as well as (a) the
Prospectus and the Memorandum, (b) an executed copy of the GACC Mortgage Loan
Purchase Agreement, and (c) an executed copy of the Pooling and Servicing
Agreement.
D-3B-1
<PAGE>
We are members of the bar of the State of New York and do not purport to be
experts on or to express any opinion herein concerning any laws other than the
laws of the State of New York and the federal laws of the United States of
America. We express no opinion herein as to the laws of any other jurisdiction.
We have not ourselves checked the accuracy or completeness of, or otherwise
independently verified, the information furnished with respect to the Prospectus
or the Memorandum. In addition, as you are aware, we did not examine or review
the Mortgage Files. However, in the course of the preparation by the Purchaser
of the Prospectus and the Memorandum, we have participated in conferences with
certain officers of the Seller, the Purchaser, counsel to the Purchaser and your
representatives, during which the contents of the Prospectus and the Memorandum
and related matters were discussed. On the basis of the discussions referred to
above, although we are not passing upon, and do not assume any responsibility
for, the accuracy, completeness or fairness of the statements contained in the
Prospectus and the Memorandum, and without independent check or verification
except as stated, no facts have come to our attention that have caused us to
believe that either the Prospectus or the Memorandum (other than financial and
statistical data included or not included therein or incorporated by reference
therein, as to which we express no opinion), as of its issue date, contained any
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
Whenever our opinion with respect to the existence or absence of facts is
indicated to be based on our knowledge or awareness, we are referring to the
actual knowledge of the [Insert Name of Counsel to Seller] attorneys who have
represented you in connection with the transactions contemplated by the
Agreements. Except as expressly set forth herein, we have not undertaken any
independent investigation to determine the existence or absence of such facts
and no inference as to our knowledge concerning such facts should be drawn from
the fact that such representation has been undertaken by us.
This letter is limited to the specific issues addressed herein and the
opinion rendered above is limited in all respects to laws and facts existing on
the date hereof. By rendering this opinion, we do not undertake to advise you
with respect to any other matter or of any change in such laws or facts or in
the interpretations of such laws which may occur after the date hereof.
We are furnishing this opinion to you solely for your benefit. This opinion
is not to be used, circulated, quoted or otherwise referred to for any other
purpose, except that the persons listed on Exhibit A hereto may rely upon this
opinion in connection with their rating of the Certificates to the same extent
as if this opinion had been addressed to them.
Very truly yours,
D-3B-2
