<PAGE>
Filed Pursuant to Rule 424(b)(5)
Registration File No.: 333-6493
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED NOVEMBER 5, 1998
$1,031,057,000 (APPROXIMATE)
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
Depositor
GMAC COMMERCIAL MORTGAGE CORPORATION
Servicer
SERIES 1999-C3 MORTGAGE PASS-THROUGH CERTIFICATES
YOU SHOULD CONSIDER CAREFULLY THE RISK FACTORS BEGINNING ON PAGE S-12 IN THIS
PROSPECTUS SUPPLEMENT AND PAGE 11 IN THE PROSPECTUS.
The certificates represent interests only in the trust created for Series
1999-C3. They do not represent interests in or obligations of GMAC Commercial
Mortgage Securities, Inc., GMAC Commercial Mortgage Corporation or any of their
affiliates.
This prospectus supprovide may be used to offer and sell the offered
certificates only if accompanied by the prospectus.
THE CERTIFICATES WILL CONSIST OF:
o The nine classes of offered certificates described in the table on
page S-4. The offered certificates are the only securities offered
pursuant to this prospectus supplement.
o Seven additional classes of private certificates, all of which are
subordinated to, and provide credit enhancement for, the offered
certificates. The private certificates are not offered by this
prospectus supplement.
THE ASSETS UNDERLYING THE CERTIFICATES WILL INCLUDE:
o A pool of 138 fixed rate, monthly pay mortgage loans secured by first
priority liens on 177 commercial and multifamily residential properties.
The mortgage pool will have an initial pool balance of approximately
$1,152,022,048.
CREDIT ENHANCEMENT:
o The subordination of certificates other than the Class A-1-a, A-1-b and
A-2 certificates will provide credit enhancement to the Class A-1-a, A-1-b
and A-2 certificates. Each class of subordinated certificates will credit
enhancement to subordinated certificates with earlier plement alphabetical
class designations.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED THE OFFERED CERTIFICATES OR DETERMINED THAT THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS IS ACCURATE OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The underwriters will sell the offered certificates at varying prices to be
determined at the time of sale. The proceeds to GMAC Commercial Mortgage
Securities, Inc. from the sale of the offered certificates will be
approximately 104.21% of their principal balance plus accrued interest, before
deducting expenses. The underwriters' commission will be the difference between
the price they pay to GMAC Commercial Mortgage Securities, Inc. for the offered
certificates and the amount they receive from the sale of the offered
certificates to the public.
Co-Lead Managers and Joint Bookrunners
DEUTSCHE BANC ALEX. BROWN GOLDMAN, SACHS & CO.
and solely as a member of the selling party
NEWMAN AND ASSOCIATES, INC.
AUGUST 26, 1999
<PAGE>
GMAC COMMERICAL MORTGAGE SECURITIES, INC.
-----------------------------------------
Mortgage Pass-Through Certificates, Series 1999-C3
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Idaho Nebraska Missouri Minnesota Illinois Michigan New Hampshire Massachusetts
1 property 5 properties 4 properties 1 property 1 property 4 properties 1 property 2 properties
$2,653,725 $4,673,453 $20,647,328 $3,244,511 $12,098,410 $16,094,862 $15,949,087 $13,790,736
0.23% of total 0.41% of total 1.79% of total 0.28% of total 1.05% of total 1.40% of total 1.38% of total 1.20% of total
Oregon Wisconsin Indiana Pennsylvania Connecticut
1 property 1 property 5 properties 3 properties 2 properties
$5,286,058 $6,082,695 $68,623,517 $12,334,523 $4,123,922
0.46% of total 0.53% of total 5.96% of total 1.07% of total 0.36% of total
Ohio New York New Jersey Delaware
7 properties 12 properties 9 properties 1 property
$48,960,798 $135,788,097 $32,244,153 $3,240,153
4.25% of total 11.79% of total 2.80% of total 0.28% of total
California Virginia Maryland West Virginia
33 properties 4 properties 3 properties 1 property
$257,522,409 $12,380,850 $9,771,141 $2,021,580
22.35% of total 1.07% of total 0.85% of total 0.18% of total
Nevada South Carolina North Carolina
1 property 1 property 6 properties
$5,937,441 $11,191,325 $37,752,413
0.52% of total 0.97% of total 3.28% of total
Arizona Colorado Kansas Tennessee Georgia
7 properties 2 properties 2 properties 4 properties 3 properties
$106,162,273 $12,427,897 $3,993,245 $11,502,989 $7,734,324
9.22% of total 1.08% of total 0.35% of total 1.00% of total 0.67% of total
Oklahoma Texas Mississippi Alabama Florida
3 properties 32 properties 2 properties 1 property 10 properties
$13,288,731 $170,965,037 $23,067,864 $4,894,842 $47,748,245
1.15% of total 14.84% of total 2.00% of total 0.42% of total 4.14% of total
</TABLE>
Hawaii
2 properties
$7,833,417
0.68% of total
Distribution of Property Types
Multifamily 22.55%
Lodging 9.19%
Industrial 8.60%
Other 1.26%
Retail 30.44%
Office 27.96%
For purposes of this map, each Mortgage Loan secured by multiple Mortgaged
Properties is treated as the number of Mortgage Loans equal to the number
of Mortgaged Properties, each of which is allocated a Cut-off Date Balance
based on Allocated Principal Amounts thereof (as defined herein).
[ ] [is less than or equal to] 1.00%
of Initial Pool Balance
[ ] 1.01% - 5.00%
of Initial Pool Balance
[ ] 5.01% - 10.00%
of Initial Pool Balance
[ ] [is greater than] 10.00%
of Initial Pool Balance
<PAGE>
IMPORTANT NOTICE ABOUT INFORMATION PRESENTED IN THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS
We tell you about the offered certificates in two separate documents that
progressively provide more detail:
o the accompanying prospectus, which provides general information, some
of which may not apply to your series of certificates; and
o this prospectus supplement, which describes the specific terms of your
series of certificates.
IF THE DESCRIPTION OF YOUR CERTIFICATES IN THIS PROSPECTUS SUPPLEMENT
DIFFERS FROM THE DESCRIPTION IN THE ACCOMPANYING PROSPECTUS, YOU SHOULD RELY ON
THE INFORMATION IN THIS PROSPECTUS SUPPLEMENT.
We include cross references in this prospectus supplement and the
accompanying prospectus to captions in these materials where you can find
further related discussions. The following table of contents and the table of
contents included in the accompanying prospectus provide the pages on which
these captions are located.
You can find a listing of the pages where significant defined terms used
in this prospectus supplement and the accompanying prospectus are defined under
the caption "Index of Significant Definitions" in this prospectus supplement
and in the accompanying prospectus.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SUMMARY .......................................... S-6
The Mortgage Pool ............................. S-6
Geographic Concentrations ..................... S-7
Property Type ................................. S-7
Call Protection ............................... S-7
Payment Terms ................................. S-7
The Certificates .............................. S-7
Certificate Designations ...................... S-7
Initial Certificate Balances of the
Certificates ............................... S-7
Distributions on the Offered Certificates S-8
Subordination ................................. S-8
Allocation of Losses and Expenses ............. S-8
Advances ...................................... S-9
Optional Termination .......................... S-9
Book-Entry Registration ....................... S-9
Denominations ................................. S-10
Yield and Prepayment Considerations ........... S-10
Legal Investment .............................. S-10
ERISA Considerations .......................... S-10
Tax Status .................................... S-10
Ratings ....................................... S-10
RISK FACTORS ..................................... S-12
DESCRIPTION OF THE MORTGAGE POOL ................. S-28
Calculations of Interest ...................... S-28
Balloon Loans ................................. S-28
ARD Loans ..................................... S-28
Loan Participation Interest ................... S-29
Amortization of Principal ..................... S-30
Due Dates ..................................... S-30
Defeasance .................................... S-30
Prepayment Provisions ......................... S-31
Earnouts and Additional Collateral Loans ...... S-31
Related Borrowers, Cross-Collateralized
Mortgage Loans and Mortgage Loans
Collateralized by Multiple Properties ....... S-32
Due-on-Sale and Due-on-Encumbrance Provisions . S-32
Secured Subordinate Financing ................. S-32
Ground Leases ................................. S-33
Loan Documentation ............................ S-33
Significant Mortgage Loans .................... S-34
The Sellers ................................... S-44
Underwriting Matters .......................... S-45
Hazard, Liability and Other Insurance ......... S-46
Assignment of the Mortgage Loans; Repurchases
and Substitutions ........................... S-47
Representations and Warranties; Repurchases ... S-48
Pool Characteristics; Changes in Mortgage
Pool ........................................ S-50
SERVICING OF THE MORTGAGE LOANS .................. S-51
The Servicer .................................. S-51
</TABLE>
S-2
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Servicing Standard .......................... S-51
Specially Serviced Mortgage Loans ........... S-51
The Operating Adviser ....................... S-52
Termination of the Servicer with Respect to
Specially Serviced Mortgage Loans and REO
Properties ................................ S-53
Servicing and Other Compensation and Payment
of Expenses ............................... S-54
Modifications, Waivers, Amendments and
Consents .................................. S-57
Enforcement of ARD Loans .................... S-58
Sale of Defaulted Mortgage Loans ............ S-58
REO Properties .............................. S-58
Inspections; Collection of Operating
Information ............................... S-59
Year 2000 Compliance ........................ S-60
DESCRIPTION OF THE CERTIFICATES ................ S-60
Denominations ............................... S-60
Book-Entry Registration of the Offered
Certificates .............................. S-61
Certificate Balances and Notional Amounts ... S-63
Pass-Through Rates .......................... S-63
Distributions ............................... S-65
Distributions of Prepayment Premiums ........ S-71
Distributions of Excess Interest ............ S-72
Distributions of Excess Liquidation
Proceeds .................................. S-73
Treatment of REO Properties ................. S-73
Interest Reserve Account .................... S-73
Subordination; Allocation of Losses and
Expenses .................................. S-73
P&I Advances ................................ S-75
Appraisal Reductions ........................ S-76
Reports to Certificateholders; Available
Information ............................... S-77
Information Available Electronically ........ S-79
Other Information ........................... S-80
Voting Rights ............................... S-80
Termination; Retirement of Certificates ..... S-81
The Trustee ................................. S-81
Year 2000 Compliance ........................ S-82
YIELD AND MATURITY CONSIDERATIONS .............. S-82
Yield Considerations ........................ S-82
Factors that Affect the Rate and Timing of
Payments and Defaults ..................... S-84
Delay in Payment of Distributions ........... S-84
Unpaid Distributable Certificate Interest S-84
Weighted Average Life ....................... S-84
Price/Yield Tables .......................... S-90
Yield Sensitivity of the Class X
Certificates .............................. S-95
FEDERAL INCOME TAX CONSEQUENCES ................ S-97
Original Issue Discount and Premium ......... S-97
New Withholding Regulations ................. S-99
Characterization of Investments in Offered
Certificates .............................. S-99
METHOD OF DISTRIBUTION ......................... S-100
LEGAL MATTERS .................................. S-101
RATINGS ........................................ S-101
LEGAL INVESTMENT ............................... S-102
ERISA CONSIDERATIONS ........................... S-102
INDEX OF SIGNIFICANT DEFINITIONS ............ S-104
ANNEX A -- CHARACTERISTICS OF THE
MORTGAGE LOANS ............................ A-1
ANNEX B -- FORM OF STATEMENT TO
CERTIFICATEHOLDERS AND SERVICER REPORTS ... B-1
ANNEX C -- STRUCTURAL AND COLLATERAL TERM
SHEET ..................................... C-1
ANNEX D -- GLOBAL CLEARANCE, SETTLEMENT AND
TAX DOCUMENTATION PROCEDURES .............. D-1
</TABLE>
S-3
<PAGE>
TRANSACTION OVERVIEW
THIS TRANSACTION OVERVIEW PROVIDES AN OVERVIEW OF CERTAIN CALCULATIONS,
CASH FLOWS AND OTHER INFORMATION TO AID YOUR UNDERSTANDING OF THIS OFFERING.
MORE DETAIL REGARDING THESE CALCULATIONS, CASH FLOWS AND OTHER INFORMATION IS
PROVIDED IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS.
THE SERIES 1999-C3 MORTGAGE PASS-THROUGH CERTIFICATES
<TABLE>
<CAPTION>
APPROXIMATE INITIAL APPROXIMATE
ORIGINAL PRINCIPAL PERCENT OF PASS- WEIGHTED AVG. PRINCIPAL
RATINGS OR NOTIONAL CREDIT THROUGH LIFE (6) WINDOW (7)
CLASS FITCH/MOODY'S AMOUNT (1) SUPPORT (5) RATE (IN YEARS) (MONTH/YEAR)
- ----- ------------- ------------------ ------------ ------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
X AAA/Aaa $1,152,022,048(2) N/A 0.5328%(3) 9.2 10/99-3/16
A-1-a AAA/Aaa $ 50,000,000 27.00% 6.9740%(4) 5.8 10/99-5/08
A-1-b AAA/Aaa $ 190,976,000 27.00% 7.2730%(8) 9.6 5/08-8/09
A-2 AAA/Aaa $ 600,000,000 27.00% 7.1790%(8) 8.8 10/99-8/09
B AA/Aa2 $ 51,840,000 22.50% 7.5400%(8) 9.9 8/09-8/09
C A/A2 $ 57,601,000 17.50% 7.7860%(8) 9.9 8/09-8/09
D A-/A3 $ 20,160,000 15.75% 7.7861%(9) 9.9 8/09-8/09
E BBB/Baa2 $ 37,440,000 12.50% 7.7861%(9) 9.9 8/09-8/09
F BBB-/Baa3 $ 23,040,000 10.50% 7.7861%(9) 9.9 8/09-8/09
G (10) $ 57,601,000 5.50% 6.9740%(8) 9.9 8/09-8/09
H (10) $ 8,640,000 4.75% 6.9740%(8) 9.9 8/09-9/09
J (10) $ 11,520,000 3.75% 6.9740%(8) 10.0 9/09-9/09
K (10) $ 14,400,000 2.50% 6.9740%(8) 10.0 9/09-9/09
L (10) $ 11,520,000 1.50% 6.9740%(8) 12.7 9/09-8/14
M (10) $ 5,760,000 1.00% 6.9740%(8) 14.9 8/14-8/14
N (10) $ 11,524,048 N/A 6.9740%(8) 14.9 8/14-3/16
</TABLE>
- ----------
(1) These amounts are approximate. They may vary upward or downward by no
more than 5%, depending upon the final composition of the pool of
mortgage loans sold to the trust.
(2) The Class X certificates will accrue interest on the Class X notional
amount. The initial Class X notional amount is approximate and will
decline as the aggregate principal balance of the underlying mortgage
loans declines. The Class X certificates will only be entitled to receive
distributions of interest.
(3) The Class X certificates will accrue interest at a variable rate based
upon the weighted average net mortgage rate. See "Description of the
Certificates--Pass-Through Rates."
(4) The pass-through rate for the Class A-1-a certificates is a fixed rate.
(5) The percent of credit support reflects the aggregate certificate balances
of all classes of certificates that will be subordinate to each class on
the date the certificates are issued, expressed as a percentage of the
initial pool balance.
(6) The weighted average life of a security is the average amount of time
that will elapse from the time the security is issued until the investor
receives all principal payments on the security, weighted on the basis of
principal paid (or, in the case of Class X certificates, the reduction in
notional amount). The weighted average life of each class is calculated
assuming that there are no prepayments on the mortgage loans and
according to the maturity assumptions described under "Yield and Maturity
Considerations" in this prospectus supplement. The rated final
distribution date is the distribution date that occurs in August, 2036.
(7) The principal window is the period during which each class would receive
distributions of principal assuming that there are no prepayments on the
mortgage loans and according to the maturity assumptions described under
"Yield and Maturity Considerations" in this prospectus supplement. The
principal window for the Class X certificates is the period during which
that class would have an outstanding notional balance, based on the same
assumptions.
(8) Lesser of the specified fixed rate or weighted average net mortgage rate.
(9) Weighted average net mortgage rate.
(10) This class is not offered by this prospectus supplement.
S-4
<PAGE>
The following table shows certain information regarding the mortgage loans
and the mortgaged properties as of the cut-off date, which is the due date of
any mortgage loan in September, 1999.
All weighted averages set forth below are based on the balances of the
mortgage loans as of that date. The balance of each mortgage loan as of the due
date for any mortgage loan in September, 1999 is its unpaid principal balance
as of that date, after applying all payments of principal due on or before that
date, whether or not those payments are received.
MORTGAGE POOL CHARACTERISTICS
<TABLE>
<CAPTION>
CHARACTERISTICS ENTIRE MORTGAGE POOL
- --------------- --------------------
<S> <C>
Initial pool balance ............................................. $1,152,022,048
Number of mortgage loans ......................................... 138
Number of mortgaged properties ................................... 177
Average balance as of the cut-off date ........................... $8,347,986
Range of mortgage rates as of the cut-off date ................... 6.70% - 8.93%
Weighted average mortgage rate ................................... 7.896%
Weighted average remaining term to maturity or anticipated
repayment date ................................................. 117.4 months
Weighted average debt service coverage ratio ..................... 1.37x
Weighted average loan-to-value ratio ............................. 68.84%
</TABLE>
The calculation of "loan-to-value ratio" and "debt service coverage ratio"
is described in Annex A to this prospectus supplement.
S-5
<PAGE>
SUMMARY
This summary highlights selected information from this document and does not
contain all of the information that you need to consider in making your
investment decision. To understand all of the terms of the offered
certificates, you should read carefully this entire document and the
accompanying prospectus.
RELEVANT PARTIES AND IMPORTANT DATES
<TABLE>
<CAPTION>
<S> <C> <C>
TITLE OF SERIES: Series 1999-C3 Mortgage CUT-OFF DATES: September 1,
Pass-Through Certificates September 5, and September 10, 1999
THE ISSUER: GMAC Commercial Mortgage DISTRIBUTION DATE: The 15th day of each
Securities Inc. Series 1999-C3 Trust month or, if the 15th day is not a
formed to issue the mortgage business day, the immediately
pass-through certificates and to acquire succeeding business day, beginning in
the mortgage pool. October, 1999.
DEPOSITOR: GMAC Commercial Mortgage CLOSING DATE: On or about
Securities, Inc. September 14, 1999.
650 Dresher Road
Horsham, Pennsylvania 19044-8015 DETERMINATION DATE: The 5th day of
(215) 328-4622 each month or, if the 5th day is not a
business day, the immediately
SELLERS: GMAC Commercial Mortgage succeeding business day.
Corporation; German American Capital
Corporation; and Goldman Sachs COLLECTION PERIOD: For any distribution
Mortgage Company date, the period that begins immediately
following the determination date in the
SERVICER: GMAC Commercial Mortgage prior calendar month and continues
Corporation through and includes the determination
date in the calendar month in which
TRUSTEE: Norwest Bank Minnesota, National that distribution date occurs, except that
Association the first collection period for each
mortgage loan begins immediately
following its cut-off date.
</TABLE>
THE MORTGAGE POOL
The mortgage pool will consist of a pool of mortgage loans secured by first
mortgage liens on fee simple and/or leasehold interests in one or more
mortgaged properties used for commercial or multifamily residential purposes.
GMAC Commercial Mortgage Corporation originated or acquired 70 of the mortgage
loans or 57.14% of the initial pool balance. German American Capital
Corporation originated or acquired 32 of the mortgage loans or 21.50% of the
initial pool balance. Archon Financial L.P. originated 36 of the mortgage loans
or 21.36% of the initial pool balance, all of which were acquired by Goldman
Sachs Mortgage Company. The mortgage loans were originated between January 1,
1998 and August 2, 1999.
Each seller will make representations and warranties with respect to the
mortgage loans sold by it. The depositor will assign these representations and
warranties to the trustee.
The following tables summarize selected mortgage loan information. In these
tables and this prospectus supplement, the percentage of the initial pool
balance refers to the principal balance of the mortgage loans or the allocated
loan amount secured by a mortgaged property. The initial pool balance of the
mortgage loans is equal to their unpaid aggregate principal balances as of
their cut-off dates, after application of all payments of principal due on
S-6
<PAGE>
or before that date, whether or not received. All mortgage pool information is
approximate and depends upon the final composition of the mortgage loans sold
to the trust.
Annex A to this prospectus supplement provides certain characteristics of the
mortgage loans on a loan-by-loan basis. Also see "Description of the Mortgage
Pool" in this prospectus supplement.
GEOGRAPHIC CONCENTRATIONS
The mortgaged properties are located in 35 states. The following table lists
the number and percentage of mortgaged properties that are located in the five
states with the highest concentrations.
<TABLE>
<CAPTION>
NUMBER OF PERCENTAGE
MORTGAGED OF INITIAL
STATE PROPERTIES POOL BALANCE
- ----- ---------- ------------
<S> <C> <C>
California ......... 33 22.35%
Texas .............. 32 14.84
New York ........... 12 11.79
Arizona ............ 7 9.22
Indiana ............ 5 5.96
</TABLE>
PROPERTY TYPE
The following table lists the number and percentage of mortgaged properties
that are operated for each indicated or other purpose.
<TABLE>
<CAPTION>
NUMBER OF PERCENTAGE
MORTGAGED OF INITIAL
PROPERTY TYPE PROPERTIES POOL BALANCE
- ------------- ---------- ------------
<S> <C> <C>
Retail ............... 34 30.44%
Office ............... 36 27.96
Multifamily .......... 55 22.55
Hospitality .......... 25 9.19
Industrial ........... 21 8.60
Mobile Home Park ..... 2 0.38
Other ................ 4 0.89
</TABLE>
CALL PROTECTION
The terms of each of the mortgage loans restrict the ability of the borrower to
prepay the loan. All but one of the mortgage loans only permit prepayment by
the borrower with a prepayment premium or the exercise of a defeasance option
by the borrower, in either case, after the expiration of a lockout period. For
a description of defeasance provisions in the mortgage loans and prepayment
provisions, see "Description of the Mortgage Pool--Defeasance" and "--Prepayment
Provisions."
PAYMENT TERMS
All the mortgage loans accrue interest at a fixed rate, although the rate on a
loan with an anticipated repayment date may increase if that loan is not repaid
on its anticipated repayment date. Six of the mortgage loans, representing
12.81% of the initial pool balance, require payments of interest only for a
period of time after origination. See "Description of the Mortgage
Pool--Calculations of Interest," and "--ARD Loans" in this prospectus
supplement.
THE CERTIFICATES
Your certificates represent the right to a portion of the collections on the
trust's assets. The certificates represent all of the beneficial ownership
interest in the trust.
The approximate initial class principal balance and initial pass-through rate
of each class of the certificates is shown on page S-4.
CERTIFICATE DESIGNATIONS
We refer to the certificates by the following designations:
<TABLE>
<CAPTION>
<S> <C>
Designation Related Class(es)
- ----------- -----------------
Offered certificates Classes X, A-1-a, A-1-b, A-2, B, C, D, E and F
Senior certificates Classes X, A-1-a, A-1-b and A-2
Interest only Class X
certificates
Subordinate Classes B, C, D, E, F, G, H, J, K, L, M and N
certificates
REMIC residual Classes R-I, R-II and R-III
certificates
REMIC regular Classes X, A-1-a, A-1-b, A-2, B, C, D, E, F, G, H, J,
certificates K, L, M and N
</TABLE>
The Class G, H, J, K, L, M and N certificates are not being offered by this
prospectus supplement.
INITIAL CERTIFICATE BALANCES OF THE CERTIFICATES
The aggregate principal balance of the certificates issued by the trust will be
approximately $1,152,022,048, but may vary upward or downward by no more than
5%.
The senior certificates will comprise approximately 73.0% and the subordinate
certificates will comprise approximately 27.0% of the initial aggregate
certificate balance of the certificates.
The Class X certificates will not have a certificate balance, but will accrue
interest on the Class X notional amount.
S-7
<PAGE>
DISTRIBUTIONS ON THE OFFERED CERTIFICATES
The trustee will make distributions to certificateholders on each distribution
date. The first distribution date will be October 15, 1999.
Until paid in full, each class of offered certificates will be entitled to
receive monthly distributions of interest.
The Class X certificates will not receive any distributions of principal.
For purposes of calculating distributions on the senior certificates on any
distribution date, however, the mortgage loans have been divided into two loan
groups, designated as loan group 1 and loan group 2. Loan group 1 will consist
of 99 mortgage loans, representing 77.45% of the initial pool balance, and loan
group 2 will consist of 39 mortgage loans, representing 22.55% of the initial
pool balance. Loan group 2 includes all of the mortgage loans that are secured
by mortgage liens on multifamily properties, and loan group 1 includes all of
the mortgage loans that are not otherwise included in loan group 2.
The borrowers make payments of interest and principal to the servicer. The
servicer will deduct its servicing fee and send the remainder to the trustee.
After deducting its trustee fee, the trustee will distribute the remaining
amount, up to the available distribution amount to the certificateholders. See
"Description of the Certificates--Distributions" for a discussion of the
available distribution amount and the priorities and amounts of distributions
on the certificates.
Distributions of interest and principal generally are not made to a class of
certificates if its certificate balance has been reduced to zero. Realized
losses or additional trust fund expenses allocated to reduce the certificate
balance of a class of certificates may be reimbursed if the available
distribution amount is sufficient. Because payments are made to classes of
certificateholders in the order of their established payment priorities, there
may not be sufficient funds to make the payments described above after
distributions to classes of certificates with a higher priority. Funds may be
insufficient if the trust experiences realized losses, incurs unanticipated
expenses or an appraisal reduction event occurs.
On any given distribution date, there may be insufficient payments received
from the mortgage loans for all classes of certificates to receive the full
amount of interest due on that date. Those certificates that do not receive
their full interest distributions on any distribution date will be entitled to
receive the shortfall in each month thereafter up to the aggregate amount of
the shortfall, in the same priority as their distribution of interest. However,
there will be no extra interest paid to make up for such delay in distribution
of interest.
The amount of interest distributed on each class on each distribution date
generally will equal:
o 1/12th of the pass-through rate for that class
multiplied by
o the related class certificate balance or class notional amount.
See "Description of the Certificates--Distributions" in this prospectus
supplement.
SUBORDINATION
The senior certificates will receive all distributions of interest and
principal before the subordinate certificates are entitled to receive
distributions of interest or principal. This subordination of the subordinate
certificates to the senior certificates provides credit support to the senior
certificates. Similarly, each class of subordinate certificates will provide
credit support to the subordinate certificates with earlier alphabetical class
designations.
ALLOCATION OF LOSSES AND EXPENSES
A loss is realized on a mortgage loan when the servicer determines that it has
received all amounts it expects to receive from the mortgage loan and that
amount is less than the outstanding principal balance on the loan plus accrued
and unpaid interest.
An additional trust fund expense is an expense incurred by the trust that is
not covered by a corresponding payment from a borrower. Additional trust fund
expenses include, among other things:
o special servicing compensation;
o interest on advances made by the servicer;
S-8
<PAGE>
o extraordinary expenses, such as indemnification and reimbursements paid to
the trustee; and
o loan-specific expenses incurred because of defaults on mortgage loans or to
remediate environmental conditions on mortgaged properties.
Losses and additional trust fund expenses will be allocated to the certificates
by deducting those losses from the certificate balances of the certificates
without making any payments to the certificateholders. In general, losses and
additional trust fund expenses are allocated if the aggregate outstanding
principal balance of the mortgage loans immediately following the distributions
to be made on the certificates on any distribution date is less than the
aggregate outstanding certificate balance of the certificates. If this happens,
the certificate balances of the certificates will be reduced as shown in the
following chart:
Step 1
Reduce the 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 and Class B
certificates to zero, in that order
|
|
Step 2
Reduce the certificate balances of the
Class A-1-a, Class A-1-b and Class A-2 certificates
on a pro rata basis to zero
A deficit may result from losses incurred on the mortgage loans and additional
trust fund expenses of the trust. Reductions in the certificate balances of the
certificates as a result of the allocation of losses and trust fund expenses
will also have the effect of reducing the notional amount of the Class X
certificates.
For a detailed description of the allocation of losses and trust fund expenses
among the certificates, see "Description of the Certificates--Subordination;
Allocation of Losses and Expenses" in this prospectus supplement.
ADVANCES
For any month, if the servicer receives a payment on a mortgage loan that is
less than the full scheduled payment, or if no payment is received at all, the
servicer will advance its own funds to cover that shortfall. However, the
servicer will make an advance only if it determines that the advance will be
recoverable from future payments or collections on that mortgage loan.
The servicer will not be required to advance the amount of any delinquent
balloon payment or any default interest or excess interest that may be due on
any ARD loan. If the servicer fails to make a required advance, the trustee
will be required to make that advance only if it determines that the advance
will be recoverable from future payments or collections on that mortgage loan.
The servicer and the trustee each will be entitled to interest on any advances
of monthly payments made by it and certain advances of servicing expenses
incurred by it or on its behalf with limited exception. See "Description of the
Certificates--P&I Advances" in this prospectus supplement and "Description of
the Certificates--Advances in Respect of Delinquencies" and "The Pooling and
Servicing Agreements--Certificate Account" in the prospectus.
OPTIONAL TERMINATION
If the remaining aggregate principal balance of the mortgage pool is less than
1% of the initial pool balance on any distribution date, the servicer or the
depositor may, but are not required to, purchase all of the mortgage loans. If
the servicer or depositor does purchase the loans, the outstanding principal
balance of the certificates will be paid in full, together with accrued
interest. See "Description of the Certificates--Certificate Balances and
Notional Amounts" and "--Termination; Retirement of Certificates."
BOOK-ENTRY REGISTRATION
Generally, the offered certificates will be available only in book-entry form
through the facilities of The Depository Trust Company in the United States or
through Cedelbank or the Euroclear System in Europe. See "Description of the
Certificates--Book-Entry Registration of the Offered Certificates" and Annex D
in this prospectus supplement and "Description of the Certificates--Book-Entry
Registration and Definitive Certificates" in the prospectus.
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<PAGE>
DENOMINATIONS
The offered certificates other than the Class X certificates are offered in
minimum denominations of $25,000 each and multiples of $1 in excess thereof.
The Class X certificates are offered in minimum denominations of $1,000,000
initial notional amount each and multiples of $1 in excess thereof.
YIELD AND PREPAYMENT CONSIDERATIONS
The yield to maturity of each class of certificates will depend upon:
o the purchase price of the certificates;
o the applicable pass-through rate;
o the characteristics of the mortgage loans; and
o the rate and timing of payments on the mortgage loans.
The interest only certificates and the subordinate certificates will be
especially sensitive to the rate of prepayments. For a discussion of special
yield and prepayment considerations applicable to these classes of
certificates, see "Risk Factors" and "Yield and Maturity Considerations" in
this prospectus supplement.
LEGAL INVESTMENT
At the time of their issuance, any of the offered certificates rated in the
category of "AAA" or "AA" or the equivalent by at least one rating agency will
be "mortgage related securities" and all other offered certificates will not be
"mortgage related securities" for purposes of the Secondary Mortgage Market
Enhancement Act of 1984. See "Legal Investment" in this prospectus supplement
for important information concerning possible restrictions on ownership of the
offered certificates by regulated institutions. You should consult your own
legal advisors in determining the extent to which the offered certificates
constitute legal investments for you.
ERISA CONSIDERATIONS
Subject to important considerations described under "ERISA Considerations" in
this prospectus supplement and in the accompanying prospectus, the senior
certificates may be eligible for purchase by persons investing assets of
employee benefit plans or individual retirement accounts. The other offered
certificates may not be sold to such plans and accounts except as may be
permitted under a prohibited transaction class exemption available to certain
insurance companies using general account assets.
TAX STATUS
The certificates (other than the residual certificates) will generally be
treated as debt for federal income tax purposes. Certificateholders (other than
holders of residual certificates) will be required to include in their income
all interest and original issue discount with respect to such debt in
accordance with the accrual method of accounting regardless of the
certificateholders' usual methods of accounting.
For federal income tax purposes, elections will be made to treat the asset
pools that make up the trust as three separate real estate mortgage investment
conduits. Except to the extent they represent the right to excess interest, the
certificates (other than the residual certificates) will represent ownership of
regular interests in one of these real estate mortgage investment conduits. For
federal income tax purposes, the residual certificates will be the residual
interests in the pool.
For further information regarding the federal income tax consequences of
investing in the offered certificates, see "Federal Income Tax Consequences" in
this prospectus supplement and in the accompanying prospectus.
RATINGS
The offered certificates are required to receive ratings from Fitch IBCA, Inc.
("Fitch") and Moody's Investors Service, Inc. ("Moody's") that are not lower
than those indicated under "Transaction Overview." The ratings on the offered
certificates address the likelihood that the holders of offered certificates
will receive timely distributions of interest and the ultimate repayment of
principal before the rated final distribution date that occurs in August, 2036.
A security rating is not a recommendation to buy, sell or hold a security and
is subject to change or withdrawal at any time by the assigning rating agency.
The ratings do not address the likelihood that holders will receive any
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<PAGE>
prepayment premiums, default interest or excess interest. The ratings also do
not address the tax treatment of payments on the certificates or the likely
actual rate of prepayments. The rate of prepayments, if different than
originally anticipated, could adversely affect the yield realized by holders of
the offered certificates or cause the Class X certificateholders to fail to
recover their initial investment.
S-11
<PAGE>
RISK FACTORS
The offered certificates are not suitable investments for all investors.
In particular, you should not purchase any class of offered certificates unless
you understand and are able to bear the risks associated with that class.
The offered certificates are complex securities and it is important that
you possess, either alone or together with an investment advisor, the expertise
necessary to evaluate the information contained in this prospectus supplement
and the accompanying prospectus in the context of your financial situation.
ALLOCATIONS OF LOSSES ON THE If losses on the mortgage loans are allocated to
MORTGAGE LOANS WOULD REDUCE your class of certificates, the amount payable
YOUR PAYMENTS AND YIELD ON to you will be reduced by the amount of these
YOUR CERTIFICATES losses and the yield to maturity on your
certificates will be reduced. Losses allocated
to a class reduce the principal balance of the
class without making a payment to the class.
Because losses on the mortgage loans, together
with expenses relating to defaulted mortgage
loans, will be allocated first to the most
subordinated class of subordinated certificates
with a positive balance, the yields on the
subordinate certificates will be extremely
sensitive to losses on the mortgage loans.
If the principal balance of all of the
subordinate certificates has been reduced to
zero due to losses on and expenses of defaulted
mortgage loans, these losses and expenses will
be allocated pro rata to the Class A-1-a, A-1-b
and A-2 certificates.
Reductions in the principal balance of any
class reduce the notional amount of the Class X
certificates by a corresponding amount,
resulting in smaller interest distributions to
the Class X certificateholders.
See "Description of the
Certificates--Subordination; Allocation of
Losses and Expenses" in this prospectus
supplement.
DELINQUENCIES, LOSSES AND The yield to maturity on the certificates will
PREPAYMENTS ON THE MORTGAGE depend significantly on the rate and timing of
LOANS WILL AFFECT THE YIELD payments of principal and interest on the
ON THE CERTIFICATES certificates. The rate and timing of principal
and interest payments on the mortgage loans,
including the rates of delinquency, loss and
prepayment, will affect the rate and timing of
payments of principal and interest on the
certificates. For a discussion of the impact on
the yields of the certificates of the rate of
delinquency, loss and prepayment on the mortgage
rates and factors that affect those rates, see
"Yield and Maturity Considerations" and
"Description of the Certificates--Subordination;
Allocation of Losses and Expenses" in this
prospectus supplement and "Risk Factors--Yield
and Prepayment Considerations" in the
prospectus For a description of prepayment
restrictions on the mortgage loans, see
"Description of the Mortgage Pool--Defeasance"
and "--Prepayment Provisions."
THE MORTGAGE LOANS ARE NOT None of the mortgages are insured or guaranteed
INSURED by the United States, any governmental entity or
instrumentality, by any private mortgage insurer
or by the depositor, the underwriters, the
servicer, the sellers or the trustee. Therefore,
you should
S-12
<PAGE>
consider payment on each mortgage loan to depend
exclusively on the borrower and any guarantor
under the particular mortgage loan documents.
CONFLICTS OF INTEREST MAY An affiliate of the servicer expects to acquire
OCCUR WHEN CERTIFICATEHOLDERS some of the subordinate certificates including a
OF VARIOUS CLASSES HAVE portion of the Class N certificates. The
DIFFERING INTERESTS affiliate's ownership of certificates could
cause a conflict between the servicer's duties
as servicer and its affiliate's interest as a
holder of a certificate, especially if actions
would have a disproportionate effect on one or
more classes of certificates. One action over
which the servicer has considerable latitude is
determining whether to liquidate or modify
defaulted mortgage loans. The servicer may
also waive provisions in ARD loans that would
require the payment of excess interest or the
replacement of the property manager if the loan
is not paid on the anticipated repayment date.
In addition, under certain circumstances, the
certificateholders representing more than 50%
of the voting rights allocated to a specified
class may terminate the rights and obligations
of the servicer to service specially serviced
mortgage loans and properties acquired through
foreclosure and appoint a replacement to
perform these duties. The servicer's affiliate
may hold more than 50% of the voting rights
allocated to that specified class. As a result,
the interests of the servicer's affiliate may
conflict with those of other certificateholders
that desire to replace the servicer of
specially serviced mortgage loans and
foreclosure properties.
The servicer is, however, required to
administer the mortgage loans in accordance
with the servicing standards without regard to
its ownership of any certificate.
See "Servicing of the Mortgage Loans--
Termination of the Servicer with Respect
to Specially Serviced Mortgage Loans and REO
Properties" and "Servicing of the Mortgage
Loans--Modifications, Waivers, Amendments and
Consents" in this prospectus supplement.
ADVERSE ENVIRONMENTAL The trust could become liable for a material
CONDITIONS MAY REDUCE OR adverse environmental condition at a mortgaged
DELAY YOUR PAYMENTS property. Any such potential liability could
reduce or delay payments to certificateholders.
"Phase I" environmental assessments have been
performed on all of the mortgaged properties.
None of the environmental assessments revealed
material adverse environmental conditions or
circumstances affecting any mortgaged property,
except those cases:
o in which the adverse conditions were
remediated or abated before the date of
issuance of the certificates;
o in which an operations and maintenance plan
or periodic monitoring of the mortgaged
property or nearby properties was
recommended;
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<PAGE>
o involving a leaking underground storage
tank or groundwater contamination at a nearby
property that had not yet materially affected
the mortgaged property and for which a
responsible party either has been identified
under applicable law or was then conducting
remediation of the related condition;
o in which groundwater, soil or other
contamination was identified or suspected,
and an escrow reserve, indemnity or other
collateral was provided to cover the
estimated costs of continued monitoring,
investigation, testing or remediation;
o involving radon; or
o in which the related borrower has agreed to
seek a "case closed" status for the issue
from the applicable governmental agency.
To decrease the likelihood of any environmental
liability against the trust, the servicer is
required to obtain a satisfactory environmental
site assessment of a mortgaged property and see
that any required remedial action is taken
before acquiring title or assuming its
operation.
See "Description of the Mortgage
Pool--Underwriting Matters--Environmental
Assessments" in this prospectus supplement and
"The Pooling and Servicing
Agreements--Realization upon Defaulted Mortgage
Loans" and "Legal Aspects of Mortgage
Loans--Environmental Considerations" in the
prospectus.
GEOGRAPHIC CONCENTRATION MAY The five states with the highest concentration
INCREASE REALIZED LOSSES ON of mortgage loans secured by mortgaged
THE MORTGAGE LOANS properties are listed in the table titled
"Geographic Concentrations" on page S-7. Any
deterioration in the real estate market or
economy or events in that state or region,
including earthquakes, hurricanes and other
natural disasters, may increase realized losses
on the mortgage loans in the trust.
In addition, improvements on mortgaged
properties located in California may be more
susceptible to earthquakes than properties
located in other parts of the country.
Generally, the mortgaged properties are not
insured for earthquake or hurricane risk. If
mortgaged properties are insured, they may be
insured for amounts less than the outstanding
principal balances of the related mortgage
loans.
THE MORTGAGE LOANS ARE All of the mortgage loans are non-recourse
NON-RECOURSE LOANS loans. If a borrower defaults on such a loan,
only the mortgaged property, and not the other
assets of the borrower, is available to satisfy
the debt. Even if the mortgage loan documents
permit recourse to the borrower or a guarantor,
the trust may not be able to ultimately collect
the amount due under that mortgage loan.
Consequently, before maturity, you should
consider payment on each mortgage loan to
depend primarily on the sufficiency of the cash
flow of the mortgaged property. At scheduled
maturity or
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<PAGE>
upon acceleration of maturity after a default,
payment depends primarily on the market value
of the mortgaged property or the ability of the
borrower to refinance the mortgaged property.
THE SELLER OF A MORTGAGE The seller of a mortgage loan will be the only
LOAN IS THE ONLY PERSON person making representations and warranties on
MAKING REPRESENTATIONS that mortgage loan. Neither the depositor nor
AND WARRANTIES ON THAT any of its affiliates will be obligated to
MORTGAGE LOAN repurchase a mortgage loan upon a breach of a
seller's representations and warranties or any
document defects if the applicable seller
defaults on its repurchase obligation. The
applicable seller may not have the financial
ability to effect these repurchases. See
"Description of the Mortgage Pool--Assignment
of the Mortgage Loans; Repurchases and
Substitutions" and "--Representations and
Warranties; Repurchases and Substitutions" in
this prospectus supplement.
BALLOON PAYMENTS MAY 109 mortgage loans, which represent 62.53% of
INCREASE LOSSES ON THE the initial pool balance, require balloon
MORTGAGE LOANS AND EXTEND payments at their stated maturity. These
THE WEIGHTED AVERAGE LIFE mortgage loans involve a greater degree of risk
OF YOUR CERTIFICATE than fully amortizing loans, because the ability
of a borrower to make a balloon payment
typically depends on its ability to refinance
the mortgage loan or sell the mortgaged
property.
A borrower's ability to repay a loan on its
stated maturity date will depend upon its
ability either to refinance the loan or to sell
the mortgaged property at a price sufficient to
permit repayment. A borrower's ability to
achieve either of these goals will be affected
by a number of factors, including:
o the availability of, and competition for,
credit for commercial or multifamily real
estate projects, which fluctuate over time;
o the prevailing interest rates;
o the fair market value of the related
properties;
o the borrower's equity in the related
properties;
o the borrower's financial condition;
o the operating history and occupancy level
of the property;
o the tax laws; and
o prevailing general and regional economic
conditions.
Any delay in collection of a balloon payment
that otherwise would be distributable to a
class, whether the delay is due to borrower
default or to modification of the mortgage loan
by the servicer, is likely to extend the
weighted average life of that class.
See "Servicing of the Mortgage Loans--
Modifications, Waivers, Amendments and
Consents," "Description of the Mortgage Pool--
Balloon Loans," and "Yield and Maturity
Considerations" in this prospectus supplement
and "Risk Factors--Investment in Commercial and
Multifamily Mortgage Loans" and "Yield and
Maturity Considerations" in the prospectus.
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<PAGE>
IF BORROWERS DO NOT MAKE 28 of the mortgage loans, which represent 37.35%
ARD PAYMENTS, THE WEIGHTED of the initial pool balance, are ARD loans. "ARD
AVERAGE LIFE OF YOUR loans" have anticipated repayment dates prior to
CLASS OF CERTIFICATES MAY their maturity dates. The failure of a borrower
BE EXTENDED to prepay an ARD loan before its anticipated
repayment date will likely extend the weighted
average life of any class of offered
certificates that would receive a distribution
of the prepayment. The ability of a borrower to
prepay an ARD loan before or at its anticipated
repayment date typically depends on its ability
to either refinance the loan or to sell the
mortgaged property. The provisions for
accelerated amortization and a higher interest
rate after the anticipated repayment date of an
ARD loan are intended to provide a borrower
with an incentive to pay the mortgage loan in
full on or before its anticipated repayment
date, but this incentive may not be sufficient.
To the extent the borrower on an ARD loan makes
payments of interest accrued at a rate of
interest higher than the normal mortgage
interest rate, the excess interest will be
distributed to the holders of the Class N
certificates. See "Description of the Mortgage
Pool--Terms and Conditions of the Mortgage
Loans--ARD Loans" and "Risk Factors-- Conflicts
of interest may occur when certificateholders
of various classes have differing interests" in
this prospectus supplement.
RISKS PARTICULAR TO RETAIL
PROPERTIES:
A SIGNIFICANT TENANT 34 mortgaged properties, securing mortgage loans
CEASING TO OPERATE AT A that represent 30.44% of the initial pool
RETAIL PROPERTY COULD balance, are retail properties.
ADVERSELY AFFECT ITS VALUE
AND CASH FLOW
The correlation between the success of tenant
businesses and property value is more direct
with respect to retail properties than other
types of commercial property, because some
component of the total rent paid by retail
tenants may be tied to a percentage of gross
sales. Significant tenants or anchor tenants at
a retail property play an important part in
generating customer traffic and making a retail
property a desirable location for other tenants
at that property. Some tenants at retail
properties may be entitled to terminate their
leases or pay reduced rent if an anchor tenant
ceases operations at that property. If anchor
stores in a mortgaged property were to close,
the borrower may be unable to replace those
anchor tenants in a timely manner or without
suffering adverse economic consequences. A
retail "anchor tenant" is generally understood
to be a tenant that is larger in size and is
important in attracting customers to a retail
property, whether or not it is located on the
mortgaged property.
A significant tenant ceasing to do business at
a retail property could result in realized
losses on the mortgage loans. The loss of a
significant tenant may be the result of the
tenant's voluntary decision not to renew a
lease, the bankruptcy or insolvency of the
tenant, the tenant's general cessation of
business activities or for other reasons. There
is no guarantee that any tenants will continue
to occupy space in the related retail property.
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<PAGE>
These risks may be increased when the property
is a single tenant property. For a description
of risk factors relating to single tenant
properties, see "--Losses may be caused by
tenant credit risk on the mortgage loans"
below.
RETAIL PROPERTIES ARE Retail properties are particularly vulnerable to
VULNERABLE TO CHANGES IN changes in consumer preferences and market
CONSUMER PREFERENCES demographics that could relate to:
o adverse changes in consumer spending
patterns;
o local competitive conditions (such as an
increased supply of retail space or the
construction of other shopping centers);
o the attractiveness of the properties and
the surrounding neighborhood to tenants and
their customers;
o the public perception of the safety of the
neighborhood; and
o the need to make major repairs or
improvements to satisfy major tenants.
COMPETITION FROM Retail properties face competition from sources
ALTERNATIVE RETAIL outside a given real estate market. Catalogue
DISTRIBUTION CHANNELS retailers, home shopping networks, the internet,
MAY ADVERSELY AFFECT THE telemarketing and outlet centers all compete
VALUE AND CASH FLOW FROM with more traditional retail properties for
RETAIL PROPERTIES consumer dollars. Continued growth of these
alternative retail outlets that often are
characterized by lower operating costs could
adversely affect the rents collectible at the
retail properties which secure mortgage loans
in the trust and result in realized losses on
the mortgage loans.
RISKS PARTICULAR TO OFFICE
PROPERTIES:
ECONOMIC DECLINE IN TENANT 36 mortgaged properties, securing mortgage loans
BUSINESSES OR CHANGES IN that represent 27.96% of the initial pool
DEMOGRAPHIC CONDITIONS balance, are office properties.
COULD ADVERSELY AFFECT Economic decline in the businesses operated by
THE VALUE AND CASH FLOW the tenants of office properties may increase
FROM OFFICE PROPERTIES the likelihood that a tenant may be unable to
pay its rent, which could result in realized
losses on the mortgage loans. For a description
of risk factors relating to single tenant
properties, see "--Losses may be caused by
tenant credit risk on the mortgage loans" below.
A number of other economic and demographic
factors may adversely affect the value of office
properties, including:
o the quality of the tenants in the building;
o the physical attributes of the building in
relation to competing buildings;
o access to transportation;
o whether tax benefits are available;
o the strength and stability of businesses
operated by the tenant or tenants;
o the desirability of the location for
business; and
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<PAGE>
o the cost of refitting office space for a
new tenant (which is often significantly
higher than the cost of refitting other types
of properties for new tenants).
These risks may be increased if revenue depends
on a single tenant or if there is a significant
concentration of tenants in a particular
business or industry. See "--A significant
tenant ceasing to operate at a retail property
could adversely affect its value and cash flow"
below.
COMPETITION WITH OTHER Office properties are subject to competition
OFFICE PROPERTIES COULD with other office properties in the same market.
ALSO ADVERSELY AFFECT THE A decrease in occupancy resulting from
VALUE AND CASH FLOW FROM competition could result in realized losses on
OFFICE PROPERTIES the mortgage loans. Competition is affected by a
property's age, condition, design, such as floor
sizes and layout, location, access to
transportation and ability to offer amenities
to its tenants including sophisticated building
systems, such as fiber optic cables, satellite
communications or other base building
technological features.
RISKS PARTICULAR TO
MULTIFAMILY PROPERTIES:
REDUCTIONS IN OCCUPANCY 55 mortgaged properties, securing mortgage loans
AND RENT LEVELS ON that represent 22.55% of the initial pool
MULTIFAMILY PROPERTIES balance, are multifamily rental properties. A
COULD ADVERSELY AFFECT decrease in occupancy or rent levels could
THEIR VALUE AND CASH FLOW result in realized losses on the mortgage loans.
Occupancy and rent levels on multifamily
properties may be adversely affected by:
o local, regional or national economic
conditions, which may limit the amount of
rent that can be charged for rental units or
result in a reduction in timely rent payments
or a reduction in occupancy levels;
o construction of additional housing units in
the same market which may compete for
tenants;
o local military base closings;
o developments at local colleges and
universities;
o national, regional and local politics,
including, in the case of multifamily rental
properties, current or future rent
stabilization and rent control laws and
agreements;
o the level of mortgage interest rates, which
may encourage tenants in multifamily rental
properties to purchase housing; and
o lack of amenities, unattractive physical
attributes or bad reputation of the mortgaged
property.
RESTRICTIONS IMPOSED ON Multifamily properties may be subject to tax
MULTIFAMILY PROPERTIES BY credit, and city, state and federal housing
GOVERNMENT PROGRAMS COULD subsidies or similar programs. The limitations
ALSO ADVERSELY AFFECT and restrictions imposed by these programs could
THEIR VALUE AND CASH FLOW result in realized losses on the mortgage loans.
The limitations and restrictions include:
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<PAGE>
o rent limitations that could adversely
affect the ability of borrowers to increase
rents to maintain the condition of their
mortgaged properties; and
o tenant income restrictions that may reduce
the number of eligible tenants in those
mortgaged properties and result in a
reduction in occupancy rates.
The differences in rents between subsidized or
supported properties and other multifamily
rental properties in the same area may not be a
sufficient economic incentive for some eligible
tenants to reside at a subsidized or supported
property that may have fewer amenities or be
less attractive as a residence.
RISKS PARTICULAR TO
HOSPITALITY PROPERTIES:
REDUCTIONS IN ROOM RATES 25 mortgaged properties, securing mortgage loans
OR OCCUPANCY AT A that represent 9.19% of the initial pool
HOSPITALITY PROPERTY COULD balance, are hospitality properties. A decrease
ADVERSELY AFFECT ITS in room rates or occupancy at hospitality
VALUE AND CASH FLOW properties could result in realized losses on
the mortgage loans. Room rates and occupancy
levels may depend upon the following factors:
o The proximity of a hospitality property to
major population centers or attractions.
o Adverse local, regional or national
economic conditions or the construction of
competing hospitality properties. Because
hospitality property rooms generally are
rented for short periods of time, hospitality
properties tend to respond more quickly to
adverse economic conditions and competition
than do other commercial properties.
o A hospitality property's ability to attract
customers and a portion of its revenues may
depend on its having a liquor license. A
liquor license may not be transferable if a
foreclosure on the related mortgaged property
occurs.
o In many parts of the country the hotel and
lodging industry is generally seasonal in
nature. This seasonality will cause periodic
fluctuations in room and other revenues,
occupancy levels, room rates and operating
expenses.
o The viability of hospitality properties
that are franchisees of national or regional
hotel chains depends in large part on the
continued existence and financial strength of
the franchisor. The public perception of the
franchise service mark and the duration of
the franchise license agreement are also
important. If the franchisee defaults on its
debt, the trustee may be unable to use the
franchise license without the consent of the
franchisor due to restrictions on transfers
imposed by the franchise license agreements.
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<PAGE>
RISKS PARTICULAR TO
INDUSTRIAL PROPERTIES:
CHANGES IN ECONOMIC AND 21 mortgaged properties, securing mortgage
DEMOGRAPHIC CONDITIONS loans that represent 8.60% of the initial pool
COULD ADVERSELY AFFECT balance, are industrial properties.
THE VALUE AND CASH FLOW
FROM INDUSTRIAL PROPERTIES The risks of economic decline in the businesses
operated by the tenants of industrial properties
are similar in both office properties and
industrial properties, although industrial
properties may be more dependent on a single
tenant. Six of the mortgage loans representing
4.56% of the initial pool balance are secured by
single tenant industrial properties. For a
description of risk factors relating to office
properties, see "--Economic decline in tenant
businesses or changes in demographic conditions
could adversely affect the value and cash flow
from office properties," and for a description
of risk factors relating to single tenant
properties, see "--Losses may be caused by
tenant credit risk on the mortgage loans"
below.
RESTRICTIONS IMPOSED Site characteristics at industrial properties
BY SITE CHARACTERISTICS may impose restrictions that could cause
AND INCREASE ENVIRONMENTAL realized losses on the mortgage loans. Site
RISKS COULD ALSO ADVERSELY characteristics which affect the value of an
AFFECT THE VALUE AND CASH industrial property include:
FLOW FROM INDUSTRIAL
PROPERTIES o clear heights;
o column spacing;
o zoning restrictions;
o number of bays and bay depths;
o divisibility;
o truck turning radius; and
o overall functionality and accessibility.
An industrial property requires availability of
labor sources, proximity to supply sources and
customers, and accessibility to rail lines,
major roadways and other distribution channels.
Properties used for many industrial purposes
are more prone to environmental concerns than
other property types.
LOSSES MAY BE CAUSED BY Tenant credit risk could reduce cash flow or
TENANT CREDIT RISK ON THE value of a mortgaged property if tenants were
MORTGAGE LOANS unable to meet their lease obligations or became
insolvent.
o If tenant sales in retail properties
decline, rents based on sales also will
decline, and tenants may be unable to pay
their rent or other occupancy costs. If a
tenant defaults, the borrower may experience
delays and costs in enforcing the lessor's
rights.
o If a significant tenant were to become
insolvent and subject to any bankruptcy or
similar law, the collection of rental
payments could be interrupted and foreclosure
on the mortgaged property made more
difficult.
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These risks may be increased when the property
is a single tenant property or is leased to
relatively few tenants. Nine of the mortgage
loans representing 5.29% of the initial pool
balance are secured by single tenant
properties.
LOSSES MAY BE CAUSED BY The income from and market value of retail,
THE EXPIRATION OF OR TENANT office and industrial properties would decline
DEFAULTS ON LEASES if space leases expired or tenants defaulted and
the borrowers were unable to renew the leases
or relet the space on comparable terms. See
"Annex A" for information regarding the
expiration of leased space for certain
mortgaged properties. Even if borrowers
successfully relet vacated space, the costs
associated with reletting, including tenant
improvements, leasing commissions and free
rent, can exceed the amount of any reserves
maintained for that purpose and reduce cash
flow from the mortgaged properties. Although
many of the mortgage loans require the borrower
to maintain escrows for leasing expenses, there
is no guarantee that these reserves will be
sufficient. See "Annex A--Characteristics of
the Mortgage Loans--Certain Replacement
Reserves and Tenant Improvement and Leasing
Commission Reserves" for information regarding
certain of these reserves.
TENANT BANKRUPTCY ENTAILS The bankruptcy or insolvency of a major tenant
RISKS (such as an anchor tenant), or a number of
smaller tenants, may adversely affect the
income produced by a mortgaged property. Under
the federal bankruptcy code, a tenant has the
option of assuming or rejecting any unexpired
lease. If the tenant rejects the lease, the
landlord's claim for breach of the lease would
be a general unsecured claim against the tenant
(unless collateral secures the claim). The
claim would be limited to the unpaid rent
reserved under the lease for the periods prior
to the bankruptcy petition or earlier surrender
of the leased premises that are unrelated to
the rejection, plus the greater of one year's
rent or 15% of the remaining reserved rent (but
not more than three years' rent). Even if
provisions in the lease prohibit assignment, in
a bankruptcy, the tenant may assign the lease
to another entity that could be less
creditworthy than the tenant may have been at
the time of origination of the mortgage loan.
See "Certain Legal Aspects of Mortgage Loans"
in the prospectus.
LOSSES MAY BE CAUSED BY Losses may be realized on the mortgage loans
INADEQUATE PROPERTY MANAGEMENT if property management is inadequate. The
property manager is responsible for the
following activities:
o responding to changes in the local market;
o planning and implementing the rental
structure, including establishing levels of
rent payments; and
o ensuring that maintenance and capital
improvements are carried out in a timely
fashion.
Sound property management controls costs,
provides appropriate service to tenants and
ensures that improvements are maintained. Sound
property management can also maintain cash
flow, reduce vacancy, leasing and repair costs
and preserve
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building value. Property management errors can
impair the long-term viability of a real estate
project and may result in losses.
CONFLICTS OF INTERESTS Losses may result if the managers of mortgaged
BETWEEN PROPERTY MANAGERS properties and the borrowers experience
AND OWNERS MAY RESULT IN conflicts of interest in the management
LOSSES or ownership of mortgaged properties. These
conflicts of interests may exist because:
o the mortgaged properties may be managed by
property managers affiliated with the
borrowers;
o the mortgaged properties may be managed by
property managers who also manage other
properties that compete with the mortgaged
properties; and
o affiliates of the managers or the
borrowers, or the managers and/or the
borrowers themselves, may also own other
properties, including competing properties.
LOSSES MAY RESULT IF THE An appraisal was conducted for each mortgaged
SERVICER IS UNABLE TO SELL A property, and the loan-to-value ratios as of the
MORTGAGED PROPERTY FOR cut-off date referred to in this prospectus
ITS APPRAISED VALUE supplement are based on the appraisals.
Appraisals, however, are not guarantees of
present or future value, and the servicer may
be unable to sell a mortgaged property for its
appraised value. Appraisals seek to establish
the amount a typically motivated buyer would
pay a typically motivated seller. This amount
could be significantly higher than the amount
obtained from the sale of a mortgaged property
under a distress or liquidation sale.
Appraisals are estimates of value at the time
of the appraisal based on the analysis and
opinion of the appraiser. The values of the
mortgaged properties may have changed
significantly since the appraisal was
performed. Generally, appraisals have not been
updated since the mortgage loan was originated.
SUBORDINATE FINANCING ON THE Four of the mortgage loans representing 3.54% of
MORTGAGED PROPERTY MAY the initial pool balance have mortgaged
INCREASE RISKS properties that are encumbered by subordinate
debt that is not part of the mortgage pool. The
existence of additional subordinate indebtedness
may adversely affect the borrower's financial
viability or the lender's security interest in
the mortgaged property and result in realized
losses because:
o refinancing the mortgage loan at maturity
for the purpose of making any balloon
payments may be more difficult;
o reduced cash flow could result in deferred
maintenance; and
o if the holder of the subordinated debt
files for bankruptcy or is placed in
involuntary receivership, foreclosing on the
mortgaged property could be delayed.
The holder of any material subordinate debt on
the mortgaged properties has agreed not to
foreclose for so long as the mortgage loan is
outstanding and the trust is not pursuing a
foreclosure action. Substantially all of the
mortgage loans either
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prohibit the borrower from encumbering the
mortgaged property with additional secured debt
or require the consent of the holder of the
first lien before so encumbering the mortgaged
property. A violation of this prohibition,
however, may not become evident until the
mortgage loan otherwise defaults. For a
description of subordinate debt relating to the
mortgaged properties, see "Description of the
Mortgage Pool--Secured Subordinate Financing"
in this prospectus supplement.
MEZZANINE DEBT SECURED BY The direct parents of some borrowers have
EQUITY IN THE BORROWER MAY pledged their equity interest in the borrower to
INCREASE RISK secure mezzanine debt incurred by the parent.
However, the existence of this indebtedness
could adversely affect the financial viability
of such borrower or the value of the equity in
the borrower held by the sponsoring entities of
the borrower. There is a risk that any holder of
mezzanine debt may attempt to use its rights as
owner of the mezzanine loan to protect itself
against an exercise of rights by the lender
under the mortgage loan. For a description of
mezzanine debt relating to the mortgaged
properties see "Description of the Mortgage
Pool--Secured Subordinate Financing" in this
prospectus supplement.
RELATED BORROWERS MAY MAKE Some borrowers under the mortgage loans are
LOSSES ON THE MORTGAGE LOANS are affiliated or under common control with one
MORE SEVERE another. When borrowers are related, any adverse
circumstances relating to one borrower or its
affiliates, and affecting one mortgage loan or
mortgaged property, also can affect the related
borrower's mortgage loans or mortgaged
properties which could make losses more severe
than would be the case if there were no related
borrowers.
For example, a borrower that owns or controls
several mortgaged properties and experiences
financial difficulty at one mortgaged property
might defer maintenance at one or more other
mortgaged properties to satisfy current
expenses of the mortgaged property experiencing
financial difficulty. Alternatively, the
borrower could attempt to avert foreclosure by
filing a bankruptcy petition. The bankruptcy or
insolvency of one borrower or its affiliate
could have an adverse effect on the operation
of all of the mortgaged properties of that
borrower and its affiliates and on the ability
of those mortgaged properties to produce
sufficient cash flow to make required payments
on the mortgage loans. See "Legal Aspects of
Mortgage Loans--Bankruptcy Laws" in the
prospectus.
LARGER-THAN-AVERAGE BALANCE Several mortgage loans, either individually or
LOANS MAY MAKE LOSSES MORE together with other mortgage loans with which
SEVERE they are cross-collateralized, have outstanding
balances that are substantially higher than the
average outstanding balance. Generally, if a
mortgage pool includes loans with larger-than-
average balances, losses are likely to be more
severe, relative to the size of the pool, than
would be the case if the aggregate balance of
the pool were distributed among a larger number
of loans.
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LOSSES COULD RESULT FROM Two mortgage loans, representing 4.20% of the
LIMITATION ON ENFORCEABILITY initial pool balance, are cross-collateralized
OF CROSS-COLLATERALIZATION with one or more other mortgage loans. Cross-
collateralization arrangements involving more
than one borrower could be challenged as a
fraudulent conveyance by creditors of a
borrower or by the representative or the
bankruptcy estate of a borrower, if that
borrower were to become a debtor in a bankruptcy
case resulting in realized losses on the
mortgage loans.
Generally, under federal and most state
fraudulent conveyance statutes, a lien granted
by a borrower to secure repayment of another
borrower's mortgage loan could be voided if a
court were to determine that:
(1) the borrower was insolvent at the time of
granting the lien, was rendered insolvent by
the granting of the lien, or was left with
inadequate capital or was unable to pay its
debts as they matured; and
(2) when it allowed its mortgaged property to
be encumbered by a lien securing the entire
indebtedness represented by the other mortgage
loan, the borrower did not receive fair
consideration or reasonably equivalent value in
return.
The additional security provided by
cross-collateralization would not be available
if a court determines that the grant was a
fraudulent conveyance. See "Description of the
Mortgage Pool--Terms and Conditions of the
Mortgage Loans--Related Borrowers,
Cross-Collateralized Mortgage Loans and
Mortgage Loans Collateralized by Multiple
Properties" in this prospectus supplement.
TAX CONSIDERATIONS RELATED TO Payment of taxes on any net income from
FORECLOSURE MAY REDUCE "foreclosure property" acquired by the trust
PAYMENTS TO CERTIFICATEHOLDERS will reduce the net proceeds available
for distribution to certificateholders. If the
trust acquires a mortgaged property after a
default on the related mortgage loan under a
foreclosure or delivery of a deed in lieu
of foreclosure, that property will be considered
"foreclosure property" under the tax rules
applicable to real estate mortgage investment
conduits, which are the same rules applicable
to real estate investment trusts. It will
continue to be considered "foreclosure property"
for a period of three full years after the
taxable year of acquisition by the trust, with
possible extensions. Any net income from this
"foreclosure property," other than qualifying
"rents from real property," will subject the
real estate mortgage investment conduit
containing the mortgage loans to federal and
possibly state or local tax on that income at
the highest marginal corporate tax rate.
STATE LAW LIMITATIONS ON Certain jurisdictions (including California)
REMEDIES have laws that prohibit more than one "judicial
action" to enforce a mortgage, and some courts
have viewed the term "judicial action" broadly.
The pooling and servicing agreement will
require the servicer and any replacement
special servicer to obtain legal advice prior
to enforcing any rights under the mortgage
loans that relate to properties where the rule
could be applicable. In addition, the
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servicer and any replacement special servicer
may be required to foreclose on properties in
states where the "one action" rules apply
before foreclosing on properties located in
states where judicial foreclosure is the only
permitted method of foreclosure. See "Certain
Legal Aspects of Mortgage Loans--Foreclosure"
in the prospectus.
Because of these considerations, the ability of
the servicer and any replacement special
servicer to foreclose on the mortgage loans may
be limited by the application of state laws.
Such actions could also subject the trust to
liability as a "mortgagee-in-possession" or
result in equitable subordination of the claims
of the trustee to the claims of other creditors
of the borrower. The servicer will be required
to consider these factors in deciding what
alternative to pursue after a default.
INCREASES IN GROUND RENTS 10 mortgaged properties securing mortgage
FOR MORTGAGED PROPERTIES loans, which represent 5.23% of the initial pool
MAY CAUSE LOSSES balance, are subject solely to the lien of a
mortgage on the applicable borrower's leasehold
interest under a ground lease.
Increases in ground rents may adversely affect
a borrower's ability to make payments under a
related mortgage loan and cause realized losses
on the mortgage loans. Mortgage loans secured
by leasehold interests may provide for the
resetting of ground lease rents based on
factors such as the fair market value of the
related mortgaged property or prevailing
interest rates.
BANKRUPTCY RULES MAY LIMIT Operation of the federal bankruptcy code
ABILITY OF LENDER TO and related state laws may interfere with the
ENFORCE REMEDIES ability of a lender to foreclose upon a
mortgaged property and to take other actions to
enforce its remedies against the borrower or
the mortgaged property. For a description of
risks related to bankruptcy, see "Certain Legal
Aspects of Mortgage Loans--Bankruptcy Laws" in
the prospectus.
Some sponsors of borrowers or their affiliates
have in the past been subject to bankruptcy
proceedings.
THE BANKRUPTCY OF A LESSOR Upon bankruptcy of a lessor or a lessee
OR A LESSEE UNDER A under a ground lease, the debtor entity has the
GROUND LEASE COULD RESULT IN right to assume and continue or reject and
LOSSES terminate the ground lease. Section 365(h) of
the federal bankruptcy code permits a ground
lessee whose ground lease is rejected by a
debtor ground lessor to remain in possession of
its leased premises under the rent reserved in
the lease for the term, including renewals of
the ground lease. The ground lessee, however,
is not entitled to enforce the obligation of
the ground lessor to provide any services
required under the ground lease. If a ground
lessee/borrower in bankruptcy rejected any or
all of its ground leases, the leasehold
mortgagee would have the right to succeed to
the ground lessee/borrower's position under the
lease only if the ground lessor had
specifically granted the mortgagee that right.
If the ground lessor and the ground
lessee/borrower are involved in concurrent
bankruptcy proceedings, the trustee may be
unable to enforce the bankrupt
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ground lessee/borrower's obligation to refuse
to treat a ground lease rejected by a bankrupt
ground lessor as terminated. If this happened,
a ground lease could be terminated
notwithstanding lender protection provisions
contained therein or in the mortgage. If the
borrower's leasehold were to be terminated
after a lease default, the leasehold mortgagee
would lose its security.
Each of the ground leases related to the
mortgage loans, however, generally contains the
following protections to mitigate this risk:
o It requires the lessor to give the
leasehold mortgagee notice of lessee defaults
and an opportunity to cure them.
o It permits the leasehold estate to be
assigned to and by the leasehold mortgagee at
and after a foreclosure sale.
o It contains certain other protective
provisions typically included in a
"mortgageable" ground lease.
See "Description of the Mortgage Pool--Ground
Leases" in this prospectus supplement.
YOUR PAYMENTS MAY BE REDUCED Noncompliance with zoning and building codes
OR DELAYED BY ZONING AND may cause the borrower to experience cash
BUILDING CODE NONCOMPLIANCE flow delays and shortfalls that would reduce or
ON THE MORTGAGED PROPERTIES delay the amount of proceeds available for
distributions to certificateholders. Each seller
has taken steps to establish that the use and
operation of the mortgaged properties securing
the mortgage loans sold by it are in compliance
in all material respects with all applicable
zoning, land-use, building, fire and health
ordinances, rules, regulations, and orders.
Evidence of this compliance may be in the form
of legal opinions, certifications from
government officials, title policy endorsements
and/or representations by the related borrower
in the related mortgage loan documents.
These steps may not have revealed all possible
violations.
Some violations may exist at any particular
mortgaged property, but the seller of the
related mortgage loan generally does not
consider those violations known to it to be
material. In many cases, the use, operation
and/or structure of a mortgaged property
constitutes a permitted nonconforming use
and/or structure that may not be rebuilt to its
current state if a material casualty event
occurs. Generally, insurance proceeds would be
available for application to the mortgage loan
if a material casualty event were to occur,
where the related seller had obtained law and
ordinance insurance to protect against losses
related to a nonconforming use, or the
mortgaged property, as rebuilt for a conforming
use, would generate sufficient income to
service the mortgage loan. If a mortgaged
property could not be rebuilt to its current
state or its current use were no longer
permitted due to building violations or changes
in zoning or other regulations, then the
borrower might experience cash flow delays and
shortfalls that would reduce or delay the
amount of proceeds available for distributions
to certificateholders.
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CHANGES IN CONCENTRATIONS OF The receipt of payments of principal, including
BORROWER, LOAN OR PROPERTY voluntary principal prepayments, liquidation
CHARACTERISTICS MAY CAUSE proceeds and the repurchase prices for any
LOSSES ON THE MORTGAGE LOANS mortgage loans repurchased due to breaches of
representations or warranties or defaults, will
cause changes in the relative concentrations of
properties, property characteristics, number of
borrowers and affiliated borrowers and
geographic location.
Because principal on the classes of
certificates entitled to payments of principal
is payable in the sequential order described
above, the classes that have a lower priority
for the payment of principal are relatively
more likely to be exposed to risks associated
with any changes in concentrations of borrower,
loan or property characteristics.
COMPLIANCE WITH THE AMERICANS If the borrower were required to pay
WITH DISABILITIES ACT MAY expenses and fines imposed by the Americans with
REDUCE PAYMENTS TO Disabilities Act of 1990, the amount available
CERTIFICATEHOLDERS to make payments on the mortgage loan would be
reduced. Under the Americans with Disabilities
Act, all public accommodations are required to
meet federal requirements related to access and
use by disabled persons. If the mortgaged
properties do not comply with this law, the
borrowers may be required to incur costs of
compliance. Noncompliance could result in the
imposition of fines by the federal government
or an award of damages to private litigants.
LITIGATION MAY REDUCE Legal proceedings may be pending and, from
PAYMENTS TO CERTIFICATEHOLDERS time to time, threatened, against the borrowers
and their affiliates relating to the business
of the borrowers and their affiliates, or
arising out of the ordinary course of that
business. This litigation could have a material
adverse effect on the distributions to
certificateholders.
YEAR 2000 PROBLEM MAY REDUCE Disruptions in the collection or distribution
OR DELAY COLLECTIONS AND of receipts on the mortgage loans due to
DISTRIBUTIONS OF RECEIPTS ON the year 2000 problem could reduce or delay
THE MORTGAGE LOANS delay your distributions.
Computer problems may arise if the servicer and
the trustee have not completed their efforts to
avoid year 2000 issues on time, or if the
computer systems of the servicer or the trustee
are not fully year 2000-ready. The "year 2000
problem" is pervasive and complex; virtually
every computer operation will be affected in
some way by the rollover of the two-digit year
value to 00. Systems that do not properly
recognize date-sensitive information when the
year changes to 2000 could generate erroneous
data or cause a system to fail.
We have been advised by each of the servicer
and the trustee that they are committed to do
one of the following:
o to implement modifications to their
respective existing systems to the extent
required to cause them to be year 2000-ready;
and/or
o acquire computer systems that are year
2000-ready in each case before January 1,
2000.
We have not, however, made any independent
investigation of the computer systems of the
servicer or the trustee.
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DESCRIPTION OF THE MORTGAGE POOL
A detailed presentation of characteristics of the mortgage loans and
mortgaged properties on an individual basis and in tabular format is presented
in Annex A.
CALCULATIONS OF INTEREST
12 of the mortgage loans, which represent 7.68% of the initial pool
balance, accrue interest at fixed interest rates on the basis of a 360-day year
consisting of twelve 30-day months. 126 of the mortgage loans, which represent
92.32% of the initial pool balance, accrue interest on the basis of a 360-day
year and the actual number of days elapsed.
Five mortgage loans, which represent 11.87% of the initial pool balance,
provide for payments of interest only for up to 47 months after origination,
during which period no payments of principal are due. In addition, one mortgage
loan which represents 0.94% of the initial pool balance, provides for payments
of interest only for the full 120 month term of the mortgage loan. The amount
of the monthly payment with respect to some of these mortgage loans will be
subject to a one-time increase to permit the commencement of scheduled
amortization of such loan. No mortgage loan, other than the ARD loans, permits
negative amortization or the deferral of accrued interest.
Each mortgage loan bears interest at a mortgage rate that is fixed for the
entire remaining term of the mortgage loan, except that certain mortgage loans
will accrue interest at a revised rate if not repaid on or before their
respective anticipated repayment dates.
BALLOON LOANS
109 of the mortgage loans, which represent approximately 62.53% of the
initial pool balance, are "balloon loans" that provide for monthly payments of
principal based on amortization schedules significantly longer than the
remaining terms of those mortgage loans. In some cases, monthly payments of
principal begin after an interest-only period. As a result, a substantial
principal amount will be due and payable together with the corresponding
interest payment on each balloon loan on its maturity date, unless the borrower
prepays the balloon loan before its maturity date. One mortgage loan, which
represents approximately 0.13% of the initial pool balance, is fully amortizing.
ARD LOANS
28 of the mortgage loans, which represent approximately 37.35% of the
initial pool balance, are ARD loans that provide for changes in the accrual of
interest and the payment of principal as of their respective anticipated
repayment dates. The anticipated repayment date for each ARD loan is set forth
on Annex A to this prospectus supplement. If a borrower elects to prepay its
ARD loan in full on its anticipated repayment date, a substantial amount of
principal will be due. If a borrower does not prepay its ARD loan on or before
its anticipated repayment date, that ARD loan will bear interest at a revised
rate that will be a fixed rate per annum equal to the mortgage rate plus 2.0%
per annum. Beginning on its anticipated repayment date, "excess interest"
accrued on an ARD loan at the excess of the revised rate over the original
mortgage rate compounded as described below, will be deferred until the
principal balance of the ARD loan has been reduced to zero. If a borrower does
not prepay its ARD loan on or before its anticipated repayment date, all or a
substantial portion of the monthly cash flow from the related mortgaged
property collected after that date, other than some minimum debt service and
specified property expenses, will be applied to the payment of principal on the
ARD loan and, after its principal balance has been reduced to zero, to the
payment of accrued and unpaid excess interest.
The failure to pay excess interest will not constitute a default under
such mortgage loans before the related maturity date. Unpaid excess interest
will, except where limited by applicable law, continue to accrue interest at
the revised rate.
As of or shortly after the anticipated repayment date, borrowers under ARD
loans will be required to enter into a lockbox agreement whereby all revenue
will be deposited directly into a designated lockbox account controlled by the
servicer. From and after the anticipated repayment date, in addition to
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paying interest at the mortgage rate and principal based on the amortization
schedule, the related borrower generally will be required to apply all
remaining monthly cash flow from the related mortgaged property to pay the
following amounts in the following order of priority:
(1) payments to required escrow funds;
(2) payment of operating expenses under the terms of an annual budget
approved by the servicer;
(3) payment of approved extraordinary operating expenses or capital
expenses not a part of the approved annual budget or allotted for in
any escrow fund;
(4) principal on the mortgage loan until the principal is paid in full;
and
(5) excess interest.
ARD loans generally prohibit the related borrower from prepaying the
mortgage loan before or, in some cases, until a specified date before the
anticipated repayment date. At that time, the borrower may prepay the loan, in
whole or in part, without payment of a penalty or yield maintenance in the form
of a "prepayment premium." To the extent the borrower on an ARD loan makes
payments of interest accrued at a rate of interest higher than the normal
mortgage interest rate, the excess interest will be distributed to the holders
of the Class N certificates.
LOAN PARTICIPATION INTEREST
In addition to the mortgage loans, the trust fund will also include a
participation interest in the Equity Inns mortgage loans. See "The Mortgage
Pool--Significant Mortgage Loans" in this prospectus supplement. The Equity
Inns loan participation, representing 4.20% of the initial pool balance, is one
of two 50% participation interests in the two Equity Inns mortgage loans that
are not included in the trust fund. The other 50% participation interest in the
Equity Inns mortgage loans is held by GMACCM.
The Equity Inns loan participation included in the trust fund and the
other participation interest were created under a participation agreement among
the depositor, as the owner of the Equity Inns mortgage loans, the trustee, as
custodian, and GMACCM. Under the mortgage loan purchase agreement to which it
is a party, GMACCM sold the Equity Inns loan participation to the depositor
which in turn transferred it to the trust fund. The terms of the participation
agreement provide that GMACCM will act as servicer and special servicer of the
Equity Inns mortgage loans on behalf of the holders of each participation
interest and will service the loans in accordance with the servicing standard
and provisions of the pooling and servicing agreement unless continuing to act
as servicer would cause any rating agency to withdraw, downgrade or qualify any
ratings then assigned to the certificates. If the servicer is terminated in
accordance with the pooling and servicing agreement, GMACCM will continue to
act as primary servicer of the Equity Inns mortgage loans. If, however, a
replacement special servicer is appointed in accordance with the pooling and
servicing agreement, that replacement special servicer will act as special
servicer of the Equity Inns mortgage loans. See "Servicing of the Mortgage
Loans-Termination of the Servicer with respect to Specially Serviced Mortgage
Loans and REO Properties."
All payments and other amounts received in respect of the Equity Inns
mortgage loans will be distributed in respect of each of the participation
interests on a pro rata basis according to their relative participation
interests.
Any P&I advances made by the servicer or the trustee under the pooling and
servicing agreement for the Equity Inns mortgage loans will be made only with
respect to the portion of the delinquent payments on the Equity Inns mortgage
loans to which the Equity Inns loan participation is entitled. The
reimbursement of any such advance, together with interest thereon, will be made
in accordance with the terms and conditions of the pooling and servicing
agreement.
Subject to the terms and conditions of the pooling and servicing
agreement, the servicer will make servicing advances for the entire Equity Inns
mortgage loan and related mortgaged properties. Servicing advances and related
interest outstanding from time to time under the pooling and servicing
agreement will only include the portion of such advances and interest that is
reimbursable from payments and other amounts payable in respect of the Equity
Inns loan participation. To the extent any servicing advances are
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not recovered from the borrower or mortgaged properties, each of the trust fund
and the holder of the other participation interest will only be obligated to
reimburse the servicer for its proportionate share of such advance, together
with advance interest thereon.
In the case of the Equity Inns mortgage loans and the related mortgaged
properties, references in this prospectus supplement to a "mortgage loan" or
amounts due thereunder and references to "mortgaged properties," or proceeds
thereon, will, except as expressly set forth herein, be deemed to be references
to the portion of the Equity Inns mortgage loan or related mortgaged properties
represented by the Equity Inns loan participation held by the trust fund.
AMORTIZATION OF PRINCIPAL
In addition to the balloon loans and the ARD loans, the mortgage pool
includes one fully amortizing mortgage loan, which represents 0.13% of the
initial pool balance.
DUE DATES
A "due date" is the date in any month on which a monthly payment on a
mortgage loan is first due. 79 of the mortgage loans, which represent 52.69% of
the initial pool balance, provide for scheduled monthly payments of principal
and/or interest (but not excess interest or principal payments calculated with
respect to excess cash flow on any ARD loan, "monthly payments") to be due on
the first day of each month. 58 of the mortgage loans, which represent 46.89%
of the initial pool balance, provide for due dates on the tenth day of each
month. One mortgage loan, which represents 0.42% of the initial pool balance,
provides for a due date on the fifth day of each month. See "Servicing of the
Mortgage Loans--Servicing and Other Compensation and Payment of Expenses" in
this prospectus supplement.
None of the mortgage loans provide for a grace period for the payment of
monthly payments of more than 15 days.
DEFEASANCE
136 of the mortgage loans provide that after a specified period, if no
default exists under the mortgage loan, the borrower may exercise a "defeasance
option" to obtain the release of one or more of the mortgaged properties, from
the lien of the mortgage upon satisfaction of conditions, including that the
borrower:
(1) pays on any due date
o all interest accrued and unpaid on the principal balance of the
mortgage note to and including that due date,
o all other sums (excluding scheduled interest or principal
payments not yet due and owing) due under the mortgage loan, and
o any costs and expenses related to the release,
(2) delivers or pledges to the trustee "defeasance collateral"
o that consists of direct, non-callable obligations of (or
non-callable obligations, fully guaranteed as to timely payment
by) the United States of America; and
o that provides payments:
o on or before all successive scheduled payment dates from such due
date to the related maturity date (or anticipated repayment date
in the case of any ARD loan), and
o in an amount equal to or greater than the scheduled payments due
on such dates under the mortgage loan (or, with respect to
cross-collateralized mortgage loans or mortgage loans secured by
multiple mortgaged properties which permit defeasance, an amount
equal to not less than the portion of such scheduled payments
allocable to the released mortgaged property), and
S-30
<PAGE>
(3) delivers a security agreement granting the trust a first priority
security interest in the defeasance collateral and an opinion of
counsel to that effect.
Simultaneously with such actions, the mortgaged property will be released
from the lien of the mortgage loan and the defeasance collateral will be
substituted as the collateral securing the mortgage loan. The depositor makes
no representation as to the enforceability of the defeasance provisions of any
mortgage loan.
PREPAYMENT PROVISIONS
All but one of the mortgage loans prohibit voluntary principal prepayments
at any time except during an open period following the expiration of the
lockout period and defeasance period for that mortgage loan or during a period
following the lockout period when any prepayment must be accompanied by a
prepayment premium. One mortgage loan, representing 0.94% of the initial pool
balance, permits prepayment, subject to payment of a prepayment premium, at any
time prior to the commencement of its defeasance period two years after the
delivery date. See Annex A for information regarding the lockout and defeasance
periods for each mortgage loan.
Any prepayment premiums actually collected on the mortgage loans will be
distributed to the respective classes of certificateholders in the amounts and
priorities described under "Description of the Certificates--Distributions--
Distributions of Prepayment Premiums" in this prospectus supplement. The
enforceability of provisions similar to the provisions of the mortgage loans
providing for the payment of a prepayment premium upon an involuntary prepayment
is unclear under the laws of a number of states. The obligation to make a
prepayment premium with an involuntary prepayment may not be enforceable under
applicable law or, if enforceable, the foreclosure proceeds may not be
sufficient to make such payment.
Liquidation proceeds recovered in respect of any defaulted mortgage loan
will, generally, be applied to cover outstanding servicing expenses and unpaid
principal and interest before being applied to cover any prepayment premium
due. The depositor makes no representation as to the enforceability of the
provision of any mortgage loan requiring the payment of a prepayment premium or
as to the collectability of any prepayment premium. Generally, no prepayment
premium will be payable upon any mandatory prepayment of a mortgage loan caused
by a casualty or condemnation. See "Legal Aspects of Mortgage Loans--Default
Interest and Limitations on Prepayments" in the prospectus.
No prepayment premium will be payable with the repurchase of a mortgage
loan by a seller for a material breach of representation or warranty on the
part of that seller or any failure to deliver any related documentation. No
prepayment premium will be payable with the purchase of all of the mortgage
loans and any REO properties in connection with the termination of the trust
fund or with the purchase of defaulted mortgage loans by the servicer or any
holder or holders of certificates evidencing a majority interest in the
controlling class. See "--Assignment of the Mortgage Loans; Repurchases and
Substitutions" and "--Representations and Warranties; Repurchases" and
"Description of the Certificates--Termination; Retirement of Certificates" in
this prospectus supplement.
EARNOUTS AND ADDITIONAL COLLATERAL LOANS
Some of the mortgage loans are additionally secured by cash reserves or
irrevocable letters of credit that will be released to the borrower upon
satisfaction by the borrower of certain leasing-related or other conditions
including, in some cases, achieving certain debt service coverage ratios or
loan-to-value ratios. If these conditions are not met, the related reserve or
credit enhancement amount will be applied to partially defease or prepay the
related mortgage loan. Any resulting partial prepayment is generally required
to be accompanied by payment of a prepayment premium. For a description of the
related earnout information, see "Annex A--Earnout Loans" and "--Additional
Collateral Loans" and for a description of prepayment provisions of the
mortgage loans and their effect on certificateholders see "Description of the
Mortgage Pool--Prepayment Provisions" and "--Yield and Maturity Considerations"
in this prospectus supplement.
S-31
<PAGE>
RELATED BORROWERS, CROSS-COLLATERALIZED MORTGAGE LOANS AND MORTGAGE LOANS
COLLATERALIZED BY MULTIPLE PROPERTIES
Two mortgage loans, which represent 4.20% of the initial pool balance, are
"cross-collateralized mortgage loans" among groups of related borrowers. For a
discussion of risks related to cross-collateralized loans, see "Risk Factors"
in this prospectus supplement. Losses could result from limitations on the
enforceability of cross-collateralization. See Annex A for information
regarding the cross-collateralized mortgage loans. 10 mortgage loans (other
than the cross-collateralized mortgage loans), which represent 14.56% of the
initial pool balance, are secured by one or more mortgages encumbering multiple
mortgaged properties. Each of these mortgage loans is evidenced by a separate
mortgage note, and is not treated as a set of cross-collateralized mortgage
loans. Because of this, the total number of mortgage loans in the mortgage pool
is 138, while the total number of mortgaged properties in the mortgage pool is
177. Generally, we treat a mortgage loan that is secured by mortgaged
properties that are located in more than one state as an individual mortgage
loan, except that when we describe the geographic concentration and property
type distribution of the mortgage pool, we treat these mortgage loans as
multiple mortgage loans that are allocated a cut-off date balance based on the
allocated loan amount.
In addition to the cross-collateralized loans and the loans secured by
multiple mortgaged properties, some sets of mortgage loans were made to
borrowers who are affiliated or under common control with one another. None of
these sets of mortgage loans represents more than 4.20% of the initial pool
balance.
DUE-ON-SALE AND DUE-ON-ENCUMBRANCE PROVISIONS
All of the mortgage loans contain both "due-on-sale" and
"due-on-encumbrance" clauses. Subject to limited exceptions, these clauses
either:
o permit the holder of the mortgage to accelerate the maturity of the
related mortgage loan if the borrower sells or transfers or encumbers
the mortgaged property in violation of the terms of the mortgage or
other loan documents, or
o prohibit the borrower from doing so without the consent of the holder
of the mortgage. See "--Secured Subordinate Financing" in this
prospectus supplement.
Some of the mortgage loans permit either:
o transfer of the related mortgaged property if specified conditions are
satisfied or if the transfer is to a borrower reasonably acceptable to
the lender, or
o transfers to certain parties related to the borrower.
The servicer will determine, in accordance with the servicing standard,
whether to exercise any right the holder of any mortgage may have under a
due-on-sale or due-on-encumbrance clause to accelerate payment of the related
mortgage loan or to withhold its consent to the transfer or encumbrance of the
mortgaged property. See "The Pooling and Servicing Agreements--Due-on-Sale and
Due-on-Encumbrance Provisions" and "Legal Aspects of Mortgage
Loans--Due-on-Sale and Due-on-Encumbrance" in the prospectus.
SECURED SUBORDINATE FINANCING
Four mortgage loans representing 3.54% of the initial pool balance are
secured by mortgaged properties known to be encumbered by subordinated debt
that is not part of the mortgage pool. In all cases, the holder of any material
subordinated debt has agreed not to foreclose for so long as the related
mortgage loan is outstanding and the trust is not pursuing a foreclosure
action. Substantially all of the remaining mortgage loans either prohibit the
borrower from encumbering the mortgaged property with additional secured debt
or will require the consent of the trustee before so encumbering such property.
S-32
<PAGE>
The following table indicates those mortgaged properties that are known to
the depositor to be encumbered by secured subordinate debt, the initial
principal amount of the secured subordinate debt and the cut-off date principal
balances of the related mortgage loans. Each holder of secured subordinate debt
has executed a subordination agreement and/or a standstill agreement.
SECURED SUBORDINATE DEBT
<TABLE>
<CAPTION>
INITIAL
PRINCIPAL
AMOUNT OF
SECURED
CONTROL CUT-OFF DATE % OF INITIAL SUBORDINATE
NUMBER LOAN NUMBER PROPERTY NAME BALANCE POOL BALANCE DEBT
- --------- ------------- ---------------------------- -------------- -------------- ------------
<S> <C> <C> <C> <C> <C>
14 22748 Laurel Apartment Portfolio $17,950,331 1.56% $4,600,000
20 23226 Air Touch Building $13,992,523 1.21% $ 655,000
74 19020 The Shops at Pennsville $ 4,793,770 0.42% $ 700,000
Shopping Center
80 901851850 Summer Pointe & Windrock $ 4,057,037 0.35% $1,023,000
Apartments
</TABLE>
Some of the mortgage loans, including the Biltmore Fashion Park loan, may
permit the borrower to incur unsecured subordinated debt in the future, subject
to delivery of a subordination agreement and/or standstill agreement and
requirements that limit the use of proceeds to refurbishing or renovating the
property and/or acquiring furniture, fixtures and equipment for the property.
Additional debt, in any form, may cause a diversion of funds from property
maintenance and increase the likelihood that the borrower will become the
subject of a bankruptcy proceeding.
With respect to one mortgage loan representing 0.35% of the initial pool
balance, the borrower has debt secured by the related mortgaged property (but
that debt is not required to be repaid unless the borrower breaches certain
covenants regarding the use of the property).
Except as described above, the depositor has not been able to confirm
whether the respective borrowers under the mortgage loans have any other debt
outstanding.
In addition, the depositor is aware that owners of the borrowers under
three mortgage loans (including the One Colorado Place and Comerica loans)
representing 8.78% of the initial pool balance have pledged solely their
ownership interest in such borrowers as collateral for "mezzanine debt". This
financing effectively reduces the indirect equity interest of any such owner in
the related mortgaged property. No such "mezzanine debt" is included in the
mortgage pool. See "Risk Factors--Subordinate financing on the mortgaged
property may increase risks" and "--Mezzanine debt secured by equity in the
borrower may increase risk" in this prospectus supplement and "Legal Aspects of
Mortgage Loans--Subordinate Financing" in the prospectus.
GROUND LEASES
10 mortgaged properties securing mortgage loans, which represent 5.23% of
the initial pool balance, are subject solely to the lien of a mortgage on the
applicable borrower's leasehold or subleasehold interest in such mortgaged
property.
None of the ground leases expires less than ten years after the stated
maturity of the related mortgage loan. Under the terms of each such ground
lease, the ground lessor generally has either made its fee interest subject to
the related mortgage or, generally, has agreed to give the holder of the
mortgage loan notice of, and has granted such holder the right to cure, any
default or breach by the lessee.
LOAN DOCUMENTATION
Except as otherwise described under "Terms and Conditions of the Mortgage
Loans--Related Borrowers, Cross-Collateralized Mortgage Loans and Mortgage
Loans Collateralized by Multiple Properties," each mortgage loan is evidenced
by a promissory note and secured by a mortgage, deed of trust or similar
security instrument that creates a first mortgage lien on a fee simple and/or
leasehold interest in a multifamily, retail, office, industrial, warehouse,
hospitality or other commercial property.
S-33
<PAGE>
SIGNIFICANT MORTGAGE LOANS
The Biltmore Fashion Park Loan
------------------------------
The Loan. The "Biltmore Fashion Park loan" representing 6.94% of the
initial pool balance was originated by GMACCM on June 16, 1999 and has a
principal balance as of the cut-off date of approximately $80,000,000. The
Biltmore Fashion Park loan is an ARD loan with an anticipated repayment date of
July 10, 2009 and a maturity date of July 10, 2029. The Biltmore Fashion Park
loan is secured by, among other things, a mortgage encumbering the borrower's
fee ownership interest in an outdoor regional shopping center located in
Phoenix, Arizona. The Biltmore Fashion Park loan requires payments of interest
only for the first twelve months after its origination date. The Biltmore
Fashion Park loan was made to Biltmore Shopping Center Partners LLC, a special
purpose bankruptcy remote limited liability company affiliated with The Taubman
Realty Group Limited Partnership, which is an affiliate of Taubman Centers,
Inc., a publicly traded real estate investment of trust on the New York Stock
Exchange, listed under the symbol "TCO".
Other payment and prepayment terms for the Biltmore Fashion Park loan are
set forth on Annex A.
The Biltmore Fashion Park Property. The Biltmore Fashion Park property is
an outdoor regional shopping center with approximately 79 in-line stores
anchored by Saks Fifth Avenue and Macy's. The property was built between 1963
and 1996 and consists of approximately 314,805 square feet of in-line space,
90,114 square feet of anchor space occupied by Saks Fifth Avenue, and an
additional anchor occupied by Macy's under a ground lease arrangement with the
borrower. Improvements to the Macy's store increasing the square footage are
currently underway. The improvements occupied by Macy's are not part of the
collateral for the Biltmore Fashion Park loan, however, square footage of the
improvements occupied by Macy's is shown on Annex A and used to calculate the
amount of the loan per square foot. According to an appraisal dated May, 1999,
the in-line stores and Saks Fifth Avenue had approximate average sales per
square foot of $440 and $330, respectively, for the twelve-month period ended
December, 1998. As of June 15, 1999, the Biltmore Fashion Park property was 96%
occupied.
The following table summarizes the breakdown of the gross leasable area,
or "GLA" and base rent information of the ten largest tenants (excluding
Macy's) at the Biltmore Fashion Park property:
TENANTS BASED ON ANNUALIZED BASE RENT
<TABLE>
<CAPTION>
APPROXIMATE ANNUALIZED
LEASE TENANT % OF ANNUALIZED % OF TOTAL BASE RENT
TENANT NAME EXPIRATION GLA GLA BASE RENT BASE RENT PER SF
- ------------------------- ------------ ---------- ----------- ------------ ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Saks Fifth Avenue 10/31/2017 90,114 16.36% $ 500,000 4.79% $ 5.55
Border Books 01/31/2004 33,416 6.07 845,425 8.10 25.30
Planet Hollywood 03/27/2014 13,087 2.38 458,045 4.39 35.00
Polo Ralph Lauren 01/31/2012 13,000 2.36 402,500 3.85 30.96
Banana Republic 01/31/2005 11,970 2.17 466,112 4.46 38.94
Nieman Marcus Galleries 12/31/2008 11,889 2.16 438,793 4.20 36.91
Restoration Hardware 10/31/2005 7,532 1.37 271,905 2.60 36.10
Claude/Paris Paris 01/31/2009 5,234 0.95 240,000 2.29 57.32
Sharper Image 01/31/2007 3,971 0.72 234,289 2.24 59.00
Coffin & Trout Jewelers 01/31/2005 1,565 0.28 300,000 2.87 191.69
------ ----- ---------- -----
Totals 191,778 34.82% $4,153,069 39.79%
======= ===== ========== =====
</TABLE>
S-34
<PAGE>
The following table summarizes information related to the expiration of
the anchor and tenant leases (excluding Macy's) of the Biltmore Fashion Park
property:
LEASE EXPIRATION SCHEDULE
<TABLE>
<CAPTION>
NUMBER EXPIRING % OF TOTAL ANNUALIZED % OF TOTAL
YEAR OF LEASES SF SF BASE RENT BASE RENT
- --------- ----------- ---------- ------------ ------------ -----------
<S> <C> <C> <C> <C> <C>
1999 2 8,998 1.63% $ 147,528 1.32%
2000 6 14,346 2.60 323,239 2.90
2001 4 8,380 1.52 249,429 2.24
2002 12 27,941 5.07 901,504 8.08
2003 7 13,634 2.47 534,400 4.79
2004 12 57,811 10.49 1,782,157 15.98
2005 5 28,611 5.19 1,382,057 12.39
2006 5 7,440 1.35 415,311 3.72
2007 11 42,026 7.63 1,557,886 13.97
2008 5 30,473 5.53 1,006,403 9.02
2009+ 8 139,041 25.24 2,122,683 19.03
</TABLE>
Operating Covenants. Macy's predecessor-in-interest, Broadway-Hale Stores,
Inc., executed a ground lease under which Macy's ground leases a portion of the
Biltmore Fashion Park property from the borrower. The current Macy's ground
lease term is scheduled to expire on January 31, 2013 and Macy's has five
additional options to extend the term of the lease for an aggregate of 75
years. The Macy's ground lease has various operating covenants including,
without limitation, that: (i) Macy's will continuously operate, in a high grade
and reputable manner, a high grade retail department store at the Biltmore
Fashion Park property, (ii) Macy's will keep the department store open on a
year-round basis, adequately stocked and staffed so as to serve customers
during all business hours on all business days so as to produce the maximum
return to the borrower and Macy's and (iii) conduct its business during the
regular, customary days and hours for such retail stores in the trade area in
which Biltmore Fashion Park property is located.
Saks & Company executed an amended and restated lease agreement under
which Saks leases a portion of the Biltmore Fashion Park property from the
borrower. The current Saks lease term is scheduled to expire on October 31,
2017. Saks may extend the term of the lease for five separate option periods of
five years each. The Saks lease has various operating covenants including that
(i) Saks will continuously use and occupy the leased premises throughout the
term of the lease as a store under the name of "Saks Fifth Avenue" for the sale
of merchandise at retail and the offering of incidental services, (ii) Saks
will keep the store open for business during the same days and hours, including
evenings, as at least one other department store and a majority of the other
tenants are open and (iii) Saks will not operate another Saks department store
in Maricopa County, Arizona.
Defeasance. The borrower may obtain the release of the Biltmore Fashion
Park property from the lien of the mortgage by exercising a defeasance option
on or after the second anniversary of the delivery date.
Value. The Biltmore Fashion Park loan has a 60.38% cut-off date LTV. An
appraisal performed in May, 1999 determined a value for the Biltmore Fashion
Park property of $132,500,000.
Underwritten NCF and DSC Ratio. The Biltmore Fashion Park loan has an
underwritten NCF of $9,894,954 and an underwritten NCF DSCR of 1.43x.
Modified Lockbox; Certain Reserves. Under the borrower's leases with the
tenants of the Biltmore Fashion Park property or otherwise, the borrower has
irrevocably directed the tenants and will direct all future tenants to deposit
rents directly into the lockbox account. Following the earlier to occur of the
anticipated repayment date, an event of default or a decrease in the DSCR
determined quarterly for the
S-35
<PAGE>
Biltmore Fashion Park property below 1.30x, the lockbox account will be under
the sole control of the servicer until such time as the Biltmore Fashion Park
property achieves a DSCR in excess of 1.30x or the event of default is cured.
In addition, if the DSCR determined quarterly for the Biltmore Fashion
Park property decreases below 1.30x, the borrower is required to deposit
certain tax, insurance, replacement, and tenant improvement and leasing
commission reserves with the servicer.
Property Management. The Biltmore Fashion Park property is managed by The
Taubman Company Limited Partnership, an affiliate of the borrower.
Permitted Financing. The borrower is permitted to incur up to $3,000,000
of unsecured indebtedness that relates solely to financing capital
improvements, compliance with legal requirements, tenant improvements, leasing
costs and equipment related to the Biltmore Fashion Park property, but only if
that indebtedness remains unsecured or is secured solely under capital lease
arrangements.
Transfer of Ownership Interests. The Biltmore Fashion Park loan permits a
one-time sale or transfer of the property with the prior written consent of the
servicer if no event of default has occurred and is continuing under the
mortgage loan and upon the satisfaction of specified conditions.
In addition, the Biltmore Fashion Park property or all of the membership
interests in the borrower and each special purpose member of the borrower may
be sold or transferred without the prior consent of the servicer if no event of
default has occurred and is continuing under the mortgage loan and upon the
satisfaction of other conditions including:
o the transferee is a single purpose, bankruptcy remote entity that
assumes all of the obligations of the borrower under the mortgage note
and other mortgage loan documents by entering into an assumption
agreement satisfactory to the servicer;
o the servicer receives confirmation that the transfer will not result
in any withdrawal, downgrade or qualification of the then current
ratings assigned by the rating agencies to the certificates; and
o the transferee is an "approved transferee."
An "approved transferee" is an entity that satisfies any of the following
tests: it is controlled by a pension fund, insurance company, national
money-center bank or an entity with long-term unsecured debt ratings of
investment grade from at least two rating agencies with at least $500,000,000
total assets and which is managed by an entity which controls at least
$1,000,000,000 in real estate assets; it has, with its affiliates and exclusive
of the Biltmore Fashion Park property, a net worth of at least $250,000,000 and
owns real estate assets of at least $500,000,000 (or if a pension fund advisor,
at least $1,000,000,000 in real estate investments); or it controls at least
twelve regional malls containing an aggregate of six million square feet or
more (inclusive of anchor tenants, but exclusive of the Biltmore Fashion Park
property).
Members of the borrower may transfer up to 50% of their interests in the
borrower without the prior consent of the servicer if no event of default has
occurred and is continuing under the mortgage loan and upon the satisfaction of
other conditions including:
o the retention of at least 50% direct or indirect ownership of the
borrower by the current sponsor and, in the event of a 50% transfer, a
requirement that the transferee must obtain the consent of the current
sponsor to specified major decisions of the borrower from and after
the date of transfer; and
o the managing member of the transferee is a single purpose bankruptcy
remote entity.
The Prime Outlets Loan
----------------------
The Loan. The "Prime Outlets loan" representing 5.45% of the initial pool
balance was originated by GMACCM on April 27, 1999 and has a principal balance
as of the cut-off date of approximately $62,835,426. The Prime Outlets loan is
an ARD loan with an anticipated repayment date of May 10, 2009 and a maturity
date of May 10, 2029. The Prime Outlets loan is secured by, among other things,
a mortgage encumbering the borrower's fee ownership interest in a partially
enclosed factory outlet center
S-36
<PAGE>
located in Niagara Falls, New York. The Prime Outlets loan was made to Prime
Outlets at Niagara Falls USA Limited Partnership, a special purpose bankruptcy
remote limited partnership sponsored by Prime Retail, Inc. Prime Retail, Inc.
is a publicly traded real estate investment trust on the New York Stock
Exchange, listed under the symbol "PRT".
Payment and prepayment terms for the Prime Outlets loan are set forth on
Annex A.
The Prime Outlets Property. The Prime Outlets property is a partially
enclosed factory outlet center consisting of approximately 533,192 square feet
of retail space and a food court. The current improvements were built and
renovated between 1983 and 1996. According to the 1998 retail sales report
provided by the borrower, the retail space had approximate weighted average
sales per square foot based on occupied square footage of $237.56, for the
twelve-month period ended December 31, 1998, and $265.91, for the period ended
December 31, 1997. As of March 1, 1999 the Prime Outlets property was 96%
occupied.
The following table summarizes the breakdown of the gross leasable area
and base rent information of the ten largest tenants of the Prime Outlets
property:
TEN LARGEST TENANTS BASED ON ANNUALIZED BASE RENT
<TABLE>
<CAPTION>
APPROXIMATE ANNUALIZED
LEASE TENANT % OF ANNUALIZED % OF TOTAL BASE RENT
TENANT NAME EXPIRATION GLA GLA BASE RENT BASE RENT PER SF
- --------------------------- ------------ ---------- ---------- ------------ ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Linens N' Things 09/30/2005 27,175 5.10% $ 279,087 3.35% $ 10.27
Old Navy 07/31/2008 15,130 2.84 249,645 3.00 16.50
Marshalls 11/30/2000 27,000 5.06 189,000 2.27 7.00
Bass Company Store 01/31/2004 8,720 1.64 165,680 1.99 19.00
Dress Barn 01/31/2006 8,157 1.53 162,732 1.95 19.95
Off 5th Saks Fifth Avenue 08/31/2010 20,359 3.82 157,782 1.89 7.75
Polo/Ralph Lauren 04/30/2004 8,248 1.55 146,801 1.76 17.80
Casual Corner 12/31/2003 7,428 1.39 141,132 1.69 19.00
Applebee's 10/31/2004 6,090 1.14 140,000 1.68 22.99
Eddie Bauer 01/31/2001 8,354 1.57 137,841 1.65 16.50
------ ----- ---------- -----
Totals 136,661 25.64% $1,769,700 21.23%
======= ===== ========== =====
</TABLE>
The following table summarizes information related to the expiration of
the in-line tenant leases of the Prime Outlets property:
LEASE EXPIRATION SCHEDULE
<TABLE>
<CAPTION>
NUMBER EXPIRING % OF TOTAL ANNUALIZED % OF TOTAL
YEAR OF LEASES SF SF BASE RENT BASE RENT
- --------- ----------- ---------- ------------ ------------ -----------
<S> <C> <C> <C> <C> <C>
1999 4 12,481 2.34% $ 148,726 1.67%
2000 8 48,037 9.01 562,578 6.76
2001 18 67,142 12.59 1,256,446 14.14
2002 21 72,124 13.53 1,450,177 16.32
2003 23 100,905 18.92 1,795,281 20.21
2004 10 47,261 8.86 936,698 10.54
2005 10 55,022 10.32 854,755 9.62
2006 7 24,304 4.56 479,737 5.40
2007 3 15,515 2.91 132,603 1.49
2008 5 26,096 4.89 556,327 6.26
2009+ 2 31,159 5.84 252,282 2.84
</TABLE>
Defeasance. The borrower may obtain the release of the Prime Outlets
property from the lien of the mortgage by exercising a defeasance option on or
after the second anniversary of the delivery date.
S-37
<PAGE>
Value. The Prime Outlets loan has a 72.73% cut-off date LTV. An appraisal
performed in January, 1999 determined a value for the Prime Outlets property of
$86,400,000.
Underwritten NCF and DSC Ratio. The Prime Outlets loan has an underwritten
NCF of $7,361,978 and an underwritten NCF DSCR of 1.36x.
Modified Lockbox. All rents payable by tenants of the Prime Outlets
property are required to be deposited directly into a lockbox account.
Following the earlier to occur of the anticipated repayment date or an event of
default, the lockbox account will be under the sole control of the servicer.
Property Management. The Prime Outlets property is self managed by the
borrower. If the servicer determines that the DSCR of the loan is less that
1.15x for three consecutive months or less than 1.20x for six consecutive
months, then the servicer may direct the borrower to enter into a property
management contract with an independent property manager acceptable to the
servicer.
Tenant Improvement and Leasing Commission Reserves. The borrower is
obligated to make monthly deposits of $61,741 into a tenant improvement and
leasing commission reserve fund held by the servicer. Upon the borrower's
request, the servicer will annually disburse to the borrower the amount then on
deposit in the reserve fund in excess of $740,892 if the servicer determines
that the Prime Outlets property has an occupancy rate of at least 90% and has
maintained a DSCR of at least 1.30x for the preceding twelve month period.
The Equity Inns Loan Participation
----------------------------------
The Participation. The "Equity Inns loan participation" representing 4.20%
of the initial pool balance has a principal balance as of the cut-off date of
$48,428,074 and represents a 50% participation interest in each of two mortgage
loans which were originated by GMACCM on June 16, 1999. The remaining 50%
participation interest in the Equity Inns mortgage loans is held by GMACCM. The
terms of the participation agreement provide that GMACCM will act as servicer
and special servicer of the Equity Inns mortgage loans on behalf of the holders
of each participation interest and will service the loans in accordance with
the servicing standard and provisions of the pooling and servicing agreement.
If the servicer is terminated in accordance with the pooling and servicing
agreement, GMACCM will continue to act as primary servicer of the Equity Inns
mortgage loan. If, however, a replacement special servicer is appointed in
accordance with the pooling and servicing agreement, that replacement special
servicer will act as special servicer of the Equity Inns mortgage loans. See
"Description of the Mortgage Pool--Loan Participation Interest" and "Servicing
of the Mortgage Loans--Termination of the Servicer with respect to Specially
Serviced Mortgage Loans and REO Properties."
The two Equity Inns mortgage loans are evidenced by two promissory notes,
each of which is payable by both of the Equity Inns borrowers, with principal
balances as of the cut-off date of $3,833,515 and $93,022,634. Each of the
nineteen mortgages is cross-collateralized and cross-defaulted. The two Equity
Inns mortgage loans are ARD loans with anticipated repayment dates of July 1,
2009 and maturity dates of July 1, 2024, and are secured by, among other
things, mortgages encumbering the respective borrower's fee ownership interest
in seventeen properties and its leasehold interest in two other properties. The
Equity Inns hotels consist of nineteen hotels located in thirteen states. The
Equity Inns mortgage loans were made to two special purpose bankruptcy remote
limited partnerships owned by Equity Inns, Inc. Equity Inns, Inc. is a publicly
traded real estate investment trust on the New York Stock Exchange, listed
under the symbol "ENN".
Payment and prepayment terms for the Equity Inns loan participation are
set forth on Annex A.
The Equity Inns Properties. The Equity Inns properties consist of nineteen
flagged hotels located in thirteen states and described in the table below.
Five of the hotels are operated under the AmeriSuites name, six are operated as
Hampton Inns, three are operated as Homewood Suites and five carry the
Residence Inns brand name. All of the hotels were constructed between 1985 and
1996. The Equity Inns properties range in size from 96 rooms to 208 rooms and
have a total of 2,453 rooms.
S-38
<PAGE>
<TABLE>
<CAPTION>
HOTEL NO. OF YEAR YEAR
NAME LOCATION ROOMS BUILT RENOVATED
- ----------------- ------------------- -------- ----------- -----------
<S> <C> <C> <C> <C>
AmeriSuites Indianapolis, IN 126 1992 1998-1999
AmeriSuites Overland Park, KS 126 1993-1994 1998-1999
AmeriSuites Columbus, OH 126 1994 1998-1999
AmeriSuites Memphis, TN 128 1996 NAP
AmeriSuites Glen Allen, VA 126 1991 1998
Hampton Inn Overland Park, KS 134 1990-1991 1998-1999
Hampton Inn Kansas City, MO 120 1987 1997
Hampton Inn Memphis, TN 126 1985 1997-1998
Hampton Inn Richardson, TX 130 1987 1998-1999
Hampton Inn Morgantown, WV 108 1991 1998
Hampton Inn Northville, MI 125 1989 1997-1998
Homewood Suites Phoenix, AZ 124 1996 NAP
Homewood Suites Sharonville, OH 111 1990 1998-1999
Homewood Suites San Antonio, TX 123 1996 NAP
Residence Inn Tucson, AZ 128 1985 1992-1999
Residence Inn Eagan, MN 120 1987 1995-1996
Residence Inn Tinton Falls, NJ 96 1988 1998-1999
Residence Inn Portland, OR 168 1990 1996-1998
Residence Inn Princeton, NJ 208 1988-1990 1998
----- --------- ---------
Total/Weighted 2,453
=====
<CAPTION>
AVERAGE
HOTEL OCCUPANCY ALLOCATED
NAME RATE (1) ADR(1)(2) REVPAR(1)(3) PARTICIPATION AMOUNT
- ----------------- ----------- ----------- -------------- ---------------------
<S> <C> <C> <C> <C>
AmeriSuites 68.40% $ 81.28 $ 55.56 $ 1,920,000.00
AmeriSuites 70.40 81.17 57.14 1,795,000.00
AmeriSuites 72.30 80.93 58.53 2,325,000.00
AmeriSuites 67.60 80.27 54.24 1,730,000.00
AmeriSuites 73.50 89.75 66.01 2,705,000.00
Hampton Inn 68.10 73.87 50.30 2,205,000.00
Hampton Inn 69.50 74.31 51.62 1,810,000.00
Hampton Inn 79.20 75.78 59.99 2,375,000.00
Hampton Inn 62.30 62.63 39.00 1,560,000.00
Hampton Inn 71.50 72.54 51.88 2,025,000.00
Hampton Inn 79.00 72.94 57.63 2,220,000.00
Homewood Suites 78.90 103.83 81.88 3,565,000.00
Homewood Suites 74.70 77.66 58.03 1,660,000.00
Homewood Suites 78.60 82.10 63.78 2,070,000.00
Residence Inn 83.00 82.26 69.01 2,665,000.00
Residence Inn 84.30 92.01 77.00 3,250,000.00
Residence Inn 82.50 108.86 86.91 2,350,000.00
Residence Inn 82.90 108.86 90.83 5,295,000.00
Residence Inn 74.30 109.46 81.30 4,985,000.00
----- ------- -------- ---------------
Total/Weighted 74.79% $ 88.84 $ 68.05 $ 48,510,000.00
===== ======= ======== ===============
</TABLE>
(1) For twelve months ended June 1, 1999
(2) Average daily rate
(3) Revenue per available room
Property Management. Five of the hotels are leased by the applicable
Equity Inns borrower to Wayne Holding Corp., a subsidiary of Prime Hospitality
Corp. under an operating lease. Each of these operating leases has a term that
expires on December 30, 2007, except for the lease on the AmeriSuites property
located in Memphis, Tennessee, which expires on June 30, 2008. Prime
Hospitality Corp. is an owner, manager and franchisor of hotels. Prime
Hospitality Corp. is a publicly traded company listed on the NYSE under the
symbol "PDQ."
The remaining fourteen properties are leased to subsidiaries of Interstate
Hotels Management, Inc. under operating leases that terminate on November 30,
2011. Interstate Hotels Management, Inc. is a publicly traded company listed on
the NASDAQ under the symbol "IHCO."
Eleven of these fourteen properties are managed by Crosswoods Hospitality
Company, LLC, an affiliate of the lessees, under management agreements that
will expire on December 31, 2011. The manager is entitled to receive a base
management fee of 6.0% of gross operating revenues under the agreement. Under
its terms, each agreement is subordinated to the operating lease and permits
the borrower to terminate the manager in the event of a default by Interstate
Hotels under the lease. The remaining three properties are managed by Promus
Hotels, Inc., which is also the franchisor for such properties under separate
management agreements, the terms of which run until 2011. The management
agreements may be terminated without penalty in the event of a foreclosure or a
deed in lieu thereof.
Each of the operating leases for Wayne Holding and Crossroads has been
subordinated to the applicable Equity Inns mortgage pursuant to a
subordination, nondisturbance and attornment agreement. Each agreement grants
the lender the right to receive notice from the applicable tenant of defaults
by the borrower under the lease, and grants the lender rights to cure such
defaults. Subject to the mortgagee's obligation to recognize a non-defaulting
tenant upon foreclosure of the mortgage, the agreement subordinates the
tenant's leasehold interest to that of the mortgagee. Each agreement prohibits
amendment of the lease without the mortgagee's consent and, in the case of the
agreement to which Crossroads is a party, provides that casualty proceeds shall
be made available for restoration of the property, provided that the franchise
remains in place or a suitable substitute is found.
S-39
<PAGE>
Defeasance. The Equity Inns borrowers may obtain the release of one or
more of the Equity Inns properties from the lien of the related mortgage by
exercising a defeasance option on or after the third anniversary of the loans'
origination dates and before the anticipated repayment date if:
o the servicer determines that the DSCR for the remaining properties
that are not released is at least 1.90x; or
o the borrower has provided additional defeasance collateral that would
generate, together with the properties that are not released, cash
flow sufficient to achieve a DSCR of at least 1.90x.
To exercise a defeasance option on an Equity Inns property, the applicable
borrower must deliver defeasance collateral in a principal amount equal to 125%
of the outstanding portion of the allocated loan amount for that property. See
"Description of the Mortgage Pool--Defeasance".
Releases and Substitutions. On or after the third anniversary of the
loans' origination dates and before the anticipated repayment date the Equity
Inns borrowers may obtain a release of one or more of the Equity Inns
properties from the lien of the Equity Inns mortgages upon the substitution of
its fee ownership interest in another hotel property for each property
released, if, among other things, the following conditions are satisfied:
o the allocated loan amount of the released properties for any
particular substitution is not greater than $25,000,000 and the total
allocated loan amount of all properties released over the term of the
loan is not greater than $50,000,000;
o the substitute property is a hotel property with substantially the
same level of services and amenities, a franchise from a
nationally-recognized hotel franchisor and with net cash flow and
property valuations that are substantially similar to the property to
be released;
o delivery of a Phase I environmental report on the substitute property
acceptable to the servicer;
o delivery of a structural and engineering report on the substitute
property acceptable to the servicer together with 125% of the cost of
immediate repairs recommended by the report;
o delivery of an appraisal acceptable to the servicer reflecting an LTV
on the Equity Inns mortgage loans not in excess of 55%, after giving
effect to the replacement; and
o confirmation from the rating agencies that the substitution will not
result in a withdrawal, downgrade or qualification of the ratings on
the certificates.
Value. The Equity Inns loans have a 49.26% cut-off date LTV. An appraisal
performed in April, 1999 determined a value for the Equity Inns properties of
$196,800,000.
Underwritten NCF and DSC Ratio. The Equity Inns loans have an underwritten
NCF DSCR of 1.90x, and an underwritten NCF of $17,808,502.
Lockbox. All rents payable by under the operating leases of the Equity
Inns properties are required to be deposited directly into a lockbox account
controlled by the servicer.
Franchise Agreements. Each of the hotel properties is operated under a
hotel franchise agreement that grants a license to operate the hotel as part of
a nationally-recognized chain.
The five hotel properties leased to Wayne Holding Corp. are licensed to
operate as AmeriSuites under separate franchise agreements between Wayne and
AmeriSuites Franchising, Inc., each dated June 16, 1999 and expiring ten years
thereafter. Each franchise agreement may be renewed for a successive ten year
term upon payment of a renewal fee and also grants Wayne an exclusive area of
operation. Under the franchise agreements, Wayne is required to pay various
fees based upon gross room sales including a continuing royalty of 5%, a
marketing contribution of 2% and reservation system fee of 1 1/2%. A "comfort
letter" delivered to the lender in connection with the loan closing gives the
lender the right to notice of defaults and the right to cure defaults on the
part of Wayne. The letter also gives the lender or a subsequent holder of the
mortgage loan the right, upon foreclosure or deed in lieu thereof, to enter
into a replacement franchise agreement for the balance of the term upon payment
of a nominal fee.
S-40
<PAGE>
Of the remaining fourteen properties leased to subsidiaries of Interstate
Hotels Management, Inc., five are licensed to operate as Residence Inns by
Marriott. The franchise agreements for the properties licensed as Residence
Inns by Marriott, except the Princeton, New Jersey location, each have terms
that expire not earlier than 2013. The mortgage loan documents provide that it
is a default if that franchise agreement is either not renewed prior to its
current expiration or if it is not replaced by a substitute franchisor
acceptable to the servicer and the rating agencies. Fees under the Marriott
franchise agreements include a continuing royalty of 5% and a marketing fund
contribution of 2 1/2% of gross room revenues. A "comfort letter" delivered to
the lender by Marriott gives notice and cure rights to the lender and provides
for operation of the properties as Residence Inns during and after a
foreclosure subject to payment of various fees, including an application fee.
If a subsequent owner is other than the lender or its wholly owned subsidiary,
they may apply for a new Residence Inn franchise agreement that will be
processed in accordance with then prevailing franchisee requirements.
Six of the remaining nine properties leased to subsidiaries of Interstate
Hotels Management, Inc. are licensed as Hampton Inns and three are licensed as
Homewood Suites, each pursuant to franchise agreements between the respective
lessee and Promus Hotels, Inc. The earliest expiration of any of these
franchise agreements is 2010. Fees under these franchise agreements include a
4% continuing royalty and 4% marketing/reservation contribution, each
calculated on gross room revenues. "Comfort letters" delivered to the lender
give notice and cure rights to the lender and give lender or the trust the
right, upon foreclosure or deed in lieu thereof, to enter into a replacement
franchise agreement for the balance of the term upon payment of a nominal fee.
A subsequent owner other than the lender or the trust may apply for a new
franchise agreement with Promus Hotels, Inc. that will be processed in
accordance with then prevailing franchisee requirements.
Ground Lease Considerations. Two of the properties, Tinton Falls, New
Jersey and Phoenix, Arizona, are subject to ground leases. The Tinton Falls
ground lease expires not earlier than 2026, and provides for successive
extensions through 2061. The Phoenix ground lease expires in 2062. Both ground
leases provide notice and cure rights for a mortgagee, and, in connection with
the making of the loan, estoppel certificates were delivered by the respective
ground lessors confirming that no defaults existed under the ground leases.
The One Colorado Place Loan
---------------------------
The Loan. The "One Colorado Place loan" representing 3.70% of the initial
pool balance was originated by GMACCM on June 17, 1999 and has a principal
balance as of the cut-off date of approximately $42,628,093. The One Colorado
Place loan is an ARD loan with an anticipated repayment date of July 10, 2009
and a maturity date of July 10, 2029. The One Colorado Place loan is secured
by, among other things, a mortgage encumbering the borrower's fee ownership
interest in an outdoor retail shopping, office and entertainment complex
located in Pasadena, California. The One Colorado Place loan was made to One
Colorado Investments LLC, a special purpose bankruptcy remote limited liability
company.
Payment and prepayment terms for the One Colorado Place loan are set forth
on Annex A.
The One Colorado Place Property. The One Colorado Place property is an
outdoor retail shopping, office and entertainment complex consisting of
approximately 47,919 square feet of office space, 181,734 square feet of retail
space, a movie theater and a parking facility. The property was built between
the 1890's and 1920's and was renovated in 1991 and 1992. According to a June
1, 1999 retail sales report provided by the borrower, the retail space had
approximate average sales per square foot of $227 inclusive of the movie
theater, and $362 excluding the movie theater, for the twelve-month period
ended December 31, 1998. As of May 17, 1999, inclusive of the movie theater,
the One Colorado Place was 91% occupied.
S-41
<PAGE>
The following table summarizes the breakdown of the gross leasable area
and base rent information of the ten largest tenants at the One Colorado Place
property:
TEN LARGEST TENANTS BASED ON ANNUALIZED BASE RENT
<TABLE>
<CAPTION>
APPROXIMATE ANNUALIZED
LEASE TENANT % OF ANNUALIZED % OF TOTAL BASE RENT
TENANT NAME EXPIRATION GLA GLA BASE RENT BASE RENT PER SF
- -------------------------------- ------------ ---------- ----------- ------------ ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
AMC Theaters 11/19/2006 47,883 17.25% $ 331,197 7.32% $ 6.92
The Gap 11/30/2007 15,279 5.51 358,995 7.93 23.50
Pacific Bell Interactive Media 06/30/2004 14,825 5.34 283,964 6.27 19.15
Crate & Barrel 01/31/2009 14,502 5.23 268,101 5.92 18.49
J. Crew 05/14/2005 9,435 3.40 339,660 7.51 36.00
Gordon Biersch Brewing Co. 12/12/2008 8,466 3.05 262,016 5.79 30.95
IL Fomaio 01/13/2013 8,000 2.88 152,640 3.37 19.08
Banana Republic 11/30/2007 6,870 2.48 201,879 4.46 29.39
Garrett & Tully 11/21/2003 6,371 2.30 152,904 3.38 24.00
Waterworks 02/28/2009 5,963 2.15 155,040 3.43 26.00
------- ------ ---------- -----
Totals 137,594 49.59% $2,506,396 55.38%
======= ====== ========== =====
</TABLE>
The following table summarizes information related to the expiration of
the in-line tenant leases of the One Colorado Place property:
LEASE EXPIRATION SCHEDULE
<TABLE>
<CAPTION>
NUMBER OF EXPIRING % OF ANNUALIZED % OF TOTAL
YEAR LEASES SF TOTAL SF BASE RENT BASE RENT
- --------- ----------- ---------- ---------- ------------ -----------
<S> <C> <C> <C> <C> <C>
1999 3 3,360 1.21% $ 15,346 0.30%
2000 2 5,443 1.96 97,972 1.94
2001 2 6,113 2.20 131,867 2.61
2002 8 9,366 3.37 258,461 5.11
2003 11 21,047 7.58 674,537 13.34
2004 9 28,611 10.31 676,153 13.38
2005 4 19,535 7.04 574,650 11.37
2006 1 47,883 17.25 331,197 6.55
2007 3 25,078 9.04 597,986 11.83
2008 6 18,294 6.59 395,443 7.82
2009+ 11 68,199 24.57 771,811 15.27
</TABLE>
Defeasance. The borrower may obtain the release of the One Colorado Place
property from the lien of the mortgage by exercising a defeasance option on or
after the second anniversary of the delivery date.
Value. The One Colorado Place loan has a 72.25% cut-off date LTV. An
appraisal performed in June, 1999 determined a value for the One Colorado Place
property of $59,000,000.
S-42
<PAGE>
Underwritten NCF and DSC Ratio. The One Colorado Place loan has an
underwritten NCF of $4,887,329 and an underwritten NCF DSCR of 1.25x.
Lockbox. All rents payable by tenants of the One Colorado Place property
are required to be deposited directly by the tenants of the One Colorado Place
property into a lockbox account under the sole control of the servicer. The
borrower is not obligated to cause the rents to be deposited directly into the
lockbox account from the date the mezzanine financing described below is paid
in full until the anticipated repayment date, if, as of the date of the
repayment of the mezzanine financing, no event of default has occurred and is
continuing under the mortgage loan.
Property Management. The One Colorado Place property is managed by One
Colorado Investments LLC, an affiliate of the borrower.
Mezzanine Financing. The members of the One Colorado Place borrower have
pledged their membership interests in the One Colorado Place borrower as
collateral for a loan having an outstanding principal balance of approximately
$4,130,000 as of the closing date of the One Colorado Place loan. The loan was
made to the One Colorado Place borrower and is held by GMACCM.
Comerica Bank Building Loan
---------------------------
The Loan. The "Comerica loan," representing 2.92% of the initial pool
balance, was originated by Banc One Mortgage Capital Markets on April 30, 1998
and purchased by GACC on April 30, 1998. The principal balance as of the
cut-off date is approximately $33,640,510. The Comerica loan is a balloon loan
with a maturity date of May 1, 2008. The Comerica loan is secured by, among
other things, a fee mortgage encumbering a 12-story office building and a
parking garage located in San Jose, California. The Comerica loan was made to
Macanan Investments, L.P., a special purpose, bankruptcy remote limited
partnership.
Payment and prepayment terms for the Comerica loan are described on
Annex A.
The Comerica Property. The Comerica property consists of approximately
213,575 net rentable square feet of office space, and a 629 space parking
facility located in the commercial business district of San Jose, California.
The Comerica property was constructed in 1983. The Comerica property was 98.8%
occupied as of April 30, 1999.
The following table summarizes the breakdown of the gross leasable area
and base rent information of the ten largest tenants of the Comerica property:
TEN LARGEST TENANTS BASED ON ANNUALIZED BASE RENT
<TABLE>
<CAPTION>
APPROXIMATE ANNUALIZED
LEASE TENANT % OF ANNUALIZED % OF TOTAL BASE RENT
TENANT NAME EXPIRATION GLA GLA BASE RENT BASE RENT PER SF
- ---------------------------------- ------------ ---------- ----------- ------------ ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Comerica Bank 01/31/2003 43,213 20.47% $1,501,220 26.23% $ 34.74
State of California 09/30/2011 32,424 15.36 901,063 15.74 27.79
Ferrari, Olsen and Ottoboni 03/31/2002 14,924 7.07 313,404 5.48 21.00
Commonwealth Land Title Ins. Co. 12/31/2003 13,674 6.48 408,579 7.14 29.88
Dazai Advertising, Inc. 08/31/2004 10,095 4.78 322,333 5.63 31.93
Brach Neal Daney & Spence 08/31/2001 9,878 4.68 207,438 3.62 21.00
Pugh Petrinovich and Company 10/31/2002 8,940 4.24 243,794 4.26 27.27
Oceans of America, Inc. 11/30/2001 8,633 4.09 186,473 3.26 21.60
Brandenberg 333 Company 06/30/2001 8,540 4.05 191,381 3.34 22.41
Comerica Bank -- CA 01/31/2003 6,213 2.94 108,106 1.89 17.40
------- ----- ---------- -----
Totals 156,534 74.16% $4,383,791 76.59%
======= ===== ========== =====
</TABLE>
S-43
<PAGE>
The following table summarizes information related to the expiration of
the ten largest tenant leases of the Comerica property:
LEASE EXPIRATION SCHEDULE
<TABLE>
<CAPTION>
NUMBER EXPIRING % OF ANNUALIZED % OF TOTAL
YEAR OF LEASES SF TOTAL SF BASE RENT BASE RENT
- -------- ----------- ---------- ---------- ------------ -----------
<S> <C> <C> <C> <C> <C>
2000 4 7,702 3.65% $ 181,716 3.17%
2001 6 36,213 17.16 803,797 14.04
2002 8 47,389 22.45 1,141,227 19.94
2003 5 68,296 32.36 2,158,010 37.70
2004 3 14,911 7.06 440,458 7.70
2005 0 0 0.00 0 0.00
2006 0 0 0.00 0 0.00
2007 2 4,132 1.96 97,506 1.70
2008 4 7,702 3.65 181,716 3.17
2009 6 36,213 17.16 803,797 14.04
</TABLE>
Value. The Comerica loan has a 65.19% cut-off date LTV calculated based on
the principal balance of the Comerica loan as of the cut-off date. An appraisal
performed in January 1998 (and updated in April 1999) determined a value for
the Comerica property of $51,600,000.
DSC Ratio. The Comerica loan has an underwritten NCF DSCR of 1.43x.
Lockbox. All rents payable by tenants of the Comerica property are
required to be deposited directly into a lockbox account controlled by the
servicer.
Property Management. The Comerica property is managed by Macanan
Marketing, Inc.
Mezzanine Financing. In addition to the Comerica loan, a "mezzanine loan"
in the amount of $4,200,000 was made to the equity holders of the borrower.
This mezzanine loan was originated by Banc One Mortgage Capital Markets on
April 30, 1998 and purchased by GACC on that date. The mezzanine loan is
secured by the mezzanine borrowers' pledge of partnership interests in the
Comerica borrower and a pledge of shareholders' interest in the general partner
of the Comerica borrower. The mezzanine loan fully amortizes over its ten-year
term. On a monthly basis, the mezzanine borrowers are required to pay $35,000
in principal payments in addition to interest at the rate quoted at Telerate
page 3750 for U.S. dollar deposits for a 30-day period in the London interbank
market plus 6%. An event of default with respect to the Comerica loan will
cause an event of default with respect to the Mezzanine loan. However, an event
of default with respect to the mezzanine loan will not cause an event of
default with respect to the Comerica loan. As the mezzanine loan is secured by
only the partnership interests in the Comerica borrower and not the real
estate, the mezzanine loan has no foreclosure rights against the Comerica
property.
THE SELLERS
GMACCM. GMAC Commercial Mortgage Corporation ("GMACCM"), a California
corporation, is an indirect wholly-owned subsidiary of GMAC Mortgage Group,
Inc., which is a wholly-owned direct subsidiary of General Motors Acceptance
Corporation. GMACCM is also an affiliate of the depositor. The principal
offices of GMACCM are located at 650 Dresher Road, Horsham, Pennsylvania 19044.
Its telephone number is (215) 328-4622.
GACC. German American Capital Corporation ("GACC"), a Maryland
corporation, is a wholly-owned subsidiary of Deutsche Bank North America
Holding Corp., which is a wholly-owned subsidiary of Deutsche Bank AG, a German
corporation. GACC is also an affiliate of Deutsche Bank Securities, one of the
underwriters. GACC engages primarily in the business of purchasing and holding
mortgage loans pending securitization, repackaging or other disposition. GACC
also acts from time to time as the
S-44
<PAGE>
originator of mortgage loans. Although GACC purchases and sells mortgage loans
for its own account, it does not act as a broker or dealer in connection with
any such loans. The principal offices of GACC are located at 31 West 52nd
Street, New York, New York 10019. Its telephone number is (212) 469-7280.
GSMC. Goldman Sachs Mortgage Company ("GSMC"), a New York limited
partnership, is an affiliate of Goldman, Sachs & Co., one of the underwriters.
GSMC engages primarily in the business of acquiring and depositing mortgage
assets in trusts in exchange for certificates evidencing interests in such
trusts and selling or otherwise distributing such certificates. The mortgage
loans sold by GSMC to the depositor were originated by Archon Financial L.P.,
an affiliate of GSMC. The principal offices of GSMC are located at 85 Broad
Street, New York, New York 10004. Its telephone number is (212) 902-1000.
The information set forth herein concerning the mortgage loan sellers and
the underwriting conducted by each with respect to the mortgage loans has been
provided by the respective mortgage loan seller, and neither the depositor nor
the underwriters make any representation or warranty as to the accuracy or
completeness of such information.
UNDERWRITING MATTERS
Environmental Assessments
"Phase I" environmental site assessments or updates of previously
conducted assessments were performed on all of the mortgaged properties. "Phase
II" environmental site assessments were performed on some mortgaged properties.
These environmental site assessments were performed for the seller of the
related mortgage loan or the report was delivered to that seller as part of its
acquisition or origination of the mortgage loan. For all but three of the
mortgaged properties which represent 1.60% of the initial pool balance, these
environmental assessments were performed during the 18-month period before the
cut-off date.
Material adverse environmental conditions or circumstances revealed by
these environmental assessments with respect to the mortgaged properties are
disclosed in "Risk Factors--Adverse environmental conditions may reduce or
delay your payments."
The information contained in this prospectus supplement is based on the
environmental assessments and has not been independently verified by the
depositor, the seller, the servicer, the underwriters or any of their
respective affiliates.
Property Condition Assessments
Inspections or updates of previously conducted inspections of all of the
mortgaged properties were conducted for the seller of the related mortgage loan
by independent licensed engineers and/or architects, or the inspection was
delivered to that seller as part of its acquisition or origination of the
mortgage loan. With respect to all but five of the mortgaged properties, which
secure mortgage loans representing 4.94% of the initial pool balance, such
inspections were conducted within the 18-month period before the cut-off date
for the related mortgage loan. Such inspections were generally commissioned to
inspect the exterior walls, roofing, interior construction, mechanical and
electrical systems and general condition of the site, buildings and other
improvements located at a mortgaged property. The resulting reports on some of
the mortgaged properties indicated a variety of deferred maintenance items and
recommended capital expenditures. In some instances, repairs or maintenance
were completed prior to closing or cash reserves were established to fund such
deferred maintenance and/or replacement items.
Appraisals
An appraisal for each mortgaged property was performed or an existing
appraisal updated on behalf of the seller of the related mortgage loan, or the
appraisal was delivered to that seller as part of its acquisition or
origination of the related mortgage loan. For all but two of the mortgaged
properties which secure mortgage loans representing 1.05% of the initial pool
balance, the appraisals were performed during the 18-month period before the
cut-off date. The appraised value of the mortgaged property or properties is
greater than the original principal balance of the mortgage loan or the
aggregate original principal balance of any set of cross-collateralized loans.
All appraisals were conducted by an independent
S-45
<PAGE>
appraiser that is state certified and/or designated as a member of the
Appraisal Institute. The appraisal for each mortgaged property or a separate
letter contains a statement by the appraiser to the effect that the appraisal
guidelines set forth in Title XI of the Financial Institutions Reform, Recovery
and Enforcement Act of 1989, as amended, were followed in preparing such
appraisal. However, none of the depositor, the underwriters, or any seller has
independently verified the accuracy of the appraiser's statement. For a
discussion of the risks related to appraisals, see "Risk Factors--Losses may
result if the servicer is unable to sell a mortgaged property for its appraised
value."
For information about the values of the mortgaged properties available to
the depositor as of the cut-off date, see Annex A to this prospectus
supplement.
HAZARD, LIABILITY AND OTHER INSURANCE
Most of the mortgage loans require that the mortgaged property be insured
by a hazard insurance policy subject to a customary deductible and in an amount
at least equal to the lesser of the outstanding principal balance of the
mortgage loan and 100% of the full insurable replacement cost of the
improvements located on the mortgaged property. If applicable, the policy
contains appropriate endorsements to avoid the application of co-insurance and
does not permit reduction in insurance proceeds for depreciation.
Flood insurance, if available, must be in effect for any mortgaged
property that at the time of origination included any area identified in the
Federal Register by the Federal Emergency Management Agency as having special
flood hazards. The flood insurance policy must meet the requirements of the
then current guidelines of the Federal Insurance Administration, be provided by
a generally acceptable insurance carrier and be in an amount representing
coverage not less than the least of:
o the outstanding principal balance of the mortgage loan,
o the full insurable value of the mortgaged property,
o the maximum amount of insurance available under the National Flood
Insurance Act of 1968, and
o 100% of the replacement cost of the improvements located on the
mortgaged property, except in some cases where self-insurance was
permitted.
Generally, the standard form of hazard insurance policy covers physical
damage or destruction of the improvements on the mortgaged property caused by
fire, lightning, explosion, smoke, windstorm and hail, riot or strike and civil
commotion. The policies may also contain some conditions and exclusions to
coverage.
Each mortgage generally also requires the borrower to maintain
comprehensive general liability insurance against claims for personal and
bodily injury, death or property damage occurring on, in or about the mortgaged
property in an amount customarily required by institutional lenders.
Each mortgage generally further requires the related borrower to maintain
business interruption or rent loss insurance in an amount not less than 100% of
the projected rental income from the related mortgaged property for not less
than twelve months.
In general, the mortgaged properties are not insured for earthquake risk.
For mortgaged properties located in California and some other seismic zones,
the seller generally conducted seismic studies to assess the "probable maximum
loss" for the related mortgaged properties. In certain circumstances, the
related borrower was required to obtain earthquake insurance covering the
mortgaged properties. Some of these mortgaged properties may be insured for
earthquake risk in amounts less than the outstanding principal balances of the
mortgage loan.
One mortgage loan representing 1.03% of the initial pool balance is
secured by a mortgaged property on which no earthquake insurance was obtained
and for which a probable maximum loss of 23% was determined by the related
seismic study.
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ASSIGNMENT OF THE MORTGAGE LOANS; REPURCHASES AND SUBSTITUTIONS
On or before September 14, 1999, the depositor will acquire the mortgage
loans directly or indirectly from the sellers, in each case, under a mortgage
loan purchase agreement dated as of the delivery date or a similar agreement to
be entered into by or assigned to the depositor, who will thereupon assign its
interests in the mortgage loans, without recourse, to the trustee for the
benefit of the holders of the certificates.
Each seller is a "mortgage asset seller" for purposes of the prospectus.
Each seller is generally required to deliver or cause to be delivered the
following documents, with respect to the mortgage loans sold by that seller to
the depositor, to the trustee:
o the original mortgage note, endorsed, without recourse, in blank or to
the order of the trustee;
o the original or a copy of the mortgage(s), together with originals or
copies of any intervening assignments of such document(s), in each
case with evidence of recording thereon unless such document(s) have
not been returned by the applicable recorder's office;
o the original or a copy of any assignment(s) of rents and leases, if
any such item is a document separate from the mortgage, together with
originals or copies of any intervening assignments, in each case with
evidence of recording thereon, unless such document(s) have not been
returned by the applicable recorder's office;
o an assignment of each mortgage in blank or in favor of the trustee, in
recordable form;
o an assignment of any assignment(s) of rents and leases, if any such
item is a document separate from the mortgage, in blank or in favor of
the trustee, in recordable form;
o any UCC financing statements and original assignments thereof to the
trustee;
o an original or copy of the related lender's title insurance policy,
or, if a title insurance policy has not yet been issued, a commitment
for title insurance "marked-up" at the closing of the mortgage loan;
and
o when relevant, the ground lease or a copy.
If a seller cannot deliver the original mortgage note for any mortgage
loan sold by it to the depositor, that seller will deliver a copy or duplicate
original of such mortgage note, together with an affidavit certifying that the
original thereof has been lost or destroyed.
The trustee will be required to review the documents delivered to it with
respect to each mortgage loan within 60 days following the delivery date. The
trustee will hold the documents in trust. Within 45 days following the delivery
date, the trustee, at the expense of the applicable seller, will cause the
assignment of each mortgage and any assignments of rents and leases to be
completed in the name of the trustee if delivered in blank and submitted for
recording in the real property records of the appropriate jurisdictions.
If the trustee determines that any of these documents were not delivered
or that any document is defective, and the omission or defect materially and
adversely affects the value of the related mortgage loan or the interests of
certificateholders in the loan, the applicable seller may deliver the document
or cure the defect within 90 days after its receipt of notice of the omission
or defect. If that seller does not cure the omission or defect, the applicable
mortgage loan purchase agreement requires the seller to repurchase the affected
mortgage loan or substitute a replacement mortgage loan for the affected
mortgage loan and pay any substitution shortfall amount. That seller will be
obligated to repurchase the affected mortgage loan within the 90-day period at
a "purchase price" at least equal to the unpaid principal balance of such
mortgage loan, together with any accrued but unpaid interest to, but not
including, the due date in the collection period of the repurchase and any
related unreimbursed servicing advances. That seller's repurchase or
substitution obligation will be the sole remedy available to the
certificateholders and the trustee. None of the depositor, any other seller or
any other person or entity will be obligated to repurchase the affected
mortgage loan if that seller defaults on its obligation to do so.
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Instead of repurchasing a mortgage loan, a seller is permitted, for two
years following the delivery date, to substitute a new replacement mortgage
loan for the affected mortgage loan. To qualify as a replacement mortgage loan,
the replacement mortgage loan must have financial terms substantially similar
to the deleted mortgage loan and meet a number of specific requirements.
A "replacement mortgage loan" must:
o have a stated principal balance of not more than the stated principal
balance of the deleted mortgage loan,
o accrue interest at a rate of interest at least equal to that of the
deleted mortgage loan,
o be a fixed-rate mortgage loan,
o have a remaining term to stated maturity or anticipated repayment
date, in the case of an ARD loan, of not greater than, and not more
than two years less than, the deleted mortgage loan, and
o be a "qualified replacement mortgage" within the meaning of 860G(a)(4)
of the Code.
In addition, the applicable seller must deposit in the distribution
account a substitution shortfall amount, equal to any excess of the purchase
price of the deleted mortgage loan over the initial stated principal balance of
the replacement mortgage loan.
REPRESENTATIONS AND WARRANTIES; REPURCHASES
In the applicable mortgage loan purchase agreement or in related
documentation, subject to some exceptions, each seller makes representations
and warranties for each of the mortgage loans sold by it to the depositor, as
of the delivery date, or as of the date stated in the representation and
warranty. Some of these representations and warranties are listed below.
(1) Immediately before the transfer to the depositor, the seller had good and
marketable title to, and was the sole owner and holder of, the mortgage
loan, free and clear of any and all liens, encumbrances and other interests
on, in or to the mortgage loan other than, in some cases, the right of a
subservicer to primary service the mortgage loan.
(2) The seller has full right and authority to sell, assign and transfer the
mortgage loan.
(3) The information pertaining to the mortgage loan provided in the mortgage
loan schedule attached to the mortgage loan purchase agreement was true and
correct in all material respects as of the cut-off date for such mortgage
loan, provided, that this representation or warranty is deemed not to
include any representation or warranty with respect to the subject matter
of any other representation or warranty given.
(4) The mortgage loan was not, as of the cut-off date for the mortgage loan, 30
days or more delinquent in respect of any monthly payment required
thereunder, without giving effect to any applicable grace period.
(5) The lien of the related mortgage is insured by an ALTA lender's title
insurance policy, or its equivalent as adopted in the applicable
jurisdiction, issued by a nationally recognized title insurance company,
insuring the originator of the 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 including:
o the lien of current real property taxes and assessments not yet due
and payable,
o covenants, conditions and restrictions, rights-of-way, easements and
other matters of public record, and
o 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 for the mortgage loan.
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 such
mortgaged property to generate net operating income sufficient to service
the mortgage loan.
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(6) The seller has not waived any material default, breach, violation or event
of acceleration existing under the related mortgage or mortgage note.
(7) There is no valid offset, defense or counterclaim to such mortgage loan.
(8) The related mortgaged property is, except as otherwise stated in the
related engineering report, to the knowledge of the seller, free and clear
of any damage that would materially and adversely affect its value as
security for the mortgage loan (except where an escrow of funds exists
sufficient to make the necessary repairs and maintenance) and the seller
has no actual notice of the commencement of a proceeding for the
condemnation of all or any material portion of the mortgaged property.
(9) At origination, the mortgage loan complied in all material respects with
all applicable usury laws.
(10) The proceeds of the mortgage loan have been fully disbursed and there is no
requirement for future advances thereunder.
(11) The mortgage note and mortgage for the mortgage loan and all other
documents and instruments evidencing, guaranteeing, insuring or otherwise
securing the 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,
redemption, fraudulent conveyance, 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.
(12) All improvements upon the 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 balance of the
mortgage loan and 100% of the full replacement cost of the improvements
located on the mortgaged property, and the related hazard insurance policy
contains appropriate endorsements to avoid the application of co-insurance
provisions and does not permit reduction in insurance proceeds for
depreciation.
(13) The mortgaged property was subject to one or more environmental site
assessments or an update of a previously conducted assessment, which was
performed on behalf of the seller, or for 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 condition or
circumstance affecting the mortgaged property that was not disclosed in the
related report(s).
(14) The mortgage loan is not cross-collateralized with a mortgage loan other
than another mortgage loan included in the mortgage pool.
(15) All escrow deposits relating to the mortgage loan that were required to be
deposited with the mortgagee or its agent under the terms of the related
loan documents have been so deposited.
(16) As of the date of origination of the mortgage loan and, to the actual
knowledge of the seller, as of the delivery 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 with priority over
the lien created by the related mortgage, except those which are insured
against by the title policy referred to in (5) above.
(17) 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,
other than amounts paid by the tenant as provided under the related lease.
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(18) 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 was
in possession of all material licenses, permits and authorizations required
by applicable laws for the ownership and operation of the mortgaged
property as it was then operated.
(19) The mortgage or mortgage note, together with applicable state law, contains
customary and enforceable provisions, subject to the exceptions listed in
paragraph (11) above, 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.
(20) In connection with the origination or acquisition of the mortgage loan, the
seller has inspected, or caused to be inspected, the mortgaged property.
(21) The mortgage loan contains provisions for the acceleration of the payment
of the unpaid principal balance of the mortgage loan if, without complying
with the requirements of the mortgage loan, the related mortgaged property
is directly or indirectly transferred or sold.
(22) The related mortgagor is an entity, other than an individual, whose
organizational documents or the mortgage loan documents provide
substantially to the effect that such mortgagor:
o is formed or organized solely for the purpose of owning and operating
one or more of the mortgaged properties securing the mortgage loan;
o may not engage in any business unrelated to such mortgaged property or
properties;
o may not incur indebtedness other than as permitted by the mortgage or
other mortgage loan documents;
o has its own books and records separate and apart from any other
person;
o holds itself out as a legal entity, separate and apart from any other
person; and
o does not have any material assets other than those related to its
interest in and the operation of the mortgaged property or properties.
If any of the foregoing representations and warranties of a seller are
materially breached for any of the mortgage loans sold by it to the depositor,
the applicable seller may cure the breach within 90 days after its receipt of
notice of the breach. If a seller does not cure the breach, the mortgage loan
purchase agreement requires that seller to repurchase the affected mortgage
loan or substitute a replacement mortgage loan. The seller will be obligated to
repurchase the affected mortgage loan within such 90-day period at the
applicable purchase price or, for two years following the delivery date,
substitute a replacement mortgage loan for the affected mortgage loan and pay
any substitution shortfall amount. See "Assignment of the Mortgage Loans;
Repurchases and Substitutions." The applicable seller's repurchase or
substitution obligation will be the sole remedy available to the
certificateholders and the trustee for any breach of a seller's representations
and warranties regarding the mortgage loans. The seller of each mortgage loan
will be the sole warranting party for each mortgage loan sold by it to the
depositor. None of the depositor, any other seller, nor any other person or
entity will be obligated to repurchase any affected mortgage loan as a result
of a breach of a seller's representations and warranties if that seller
defaults on its obligation to do so. See "The Pooling and Servicing
Agreements--Representations and Warranties; Repurchases" in the prospectus.
POOL CHARACTERISTICS; CHANGES IN MORTGAGE POOL
The description in this prospectus supplement of the mortgage pool and the
mortgaged properties is based upon the mortgage loans that are expected to
constitute the mortgage pool at the time the offered certificates are issued.
The principal balances of the mortgage loans are reduced to reflect the
scheduled principal payments due on or before the cut-off date. Before the
issuance of the offered certificates, a mortgage loan may be removed from the
mortgage pool if the depositor deems such removal necessary
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or appropriate or if it is prepaid. A limited number of other mortgage loans
may be included in the mortgage pool before the issuance of the offered
certificates, unless including such mortgage loans would materially alter the
characteristics of the mortgage pool as described in this prospectus
supplement. As a result, the range of mortgage rates and maturities and some
other characteristics of the mortgage pool may vary depending on the actual
composition of the mortgage pool at the time the offered certificates are
issued.
A Current Report on Form 8-K will be available to purchasers of the
offered certificates on or shortly after the delivery date and will be filed,
together with the pooling and servicing agreement and each mortgage loan
purchase agreement, with the SEC within fifteen days after the initial issuance
of the offered certificates. If mortgage loans are removed from or added to the
mortgage pool as described in the preceding paragraph, such removal or addition
will be noted in the Form 8-K.
SERVICING OF THE MORTGAGE LOANS
THE SERVICER
As of June 30, 1999, GMAC Commercial Mortgage Corporation had a total
commercial and multifamily mortgage loan servicing portfolio of approximately
$58.27 billion. See "GMAC Commercial Mortgage Corporation" in the prospectus.
Set forth below is a description of pertinent provisions of the pooling
and servicing agreement relating to the servicing of the mortgage loans.
Reference is also made to the prospectus, in particular to the section
captioned "The Pooling and Servicing Agreements," for important additional
information regarding the terms and conditions of the pooling and servicing
agreement as they relate to the rights and obligations of the servicer
thereunder. The servicer is a "master servicer" and a "special servicer" for
purposes of the prospectus. Information provided in the prospectus should be
read taking account of all supplemental information contained in this
prospectus supplement.
SERVICING STANDARD
The servicer will be responsible for the servicing and administration of
the mortgage loans. The servicer, either directly or through sub-servicers,
will be required to service and administer the mortgage loans under the
following "servicing standard":
o in the best interests of and for the benefit of the certificateholders
as determined by the servicer in its good faith and reasonable
judgment,
o in accordance with applicable law, the terms of the pooling and
servicing agreement and the terms of the respective mortgage loans,
and
o to the extent consistent with the foregoing, in the same manner as is
normal and usual in its general mortgage servicing and REO property
management activities with respect to mortgage loans and REO
properties that are comparable to those for which it is responsible
under the pooling and servicing agreement.
SPECIALLY SERVICED MORTGAGE LOANS
A "specially serviced mortgage loan" is any mortgage loan as to which any
of the following "special servicing events" has occurred:
(1) any balloon payment is more than 30 days late or, if the servicer has
determined that the related borrower has obtained a firm commitment to
refinance, more than 60 days late;
(2) any monthly payment or other payment required under the mortgage note
or the mortgage(s) (other than a balloon payment) is more than 60 days
late;
(3) the 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 mortgage note or the mortgage(s) 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;
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(4) a default under the loan documents, other than as described in clause
(1) or (2) above, that materially impairs the value of the mortgaged
property as security for the mortgage loan, or otherwise materially
and adversely affects the interests of certificateholders, exists for
the applicable grace period under the terms of the mortgage loan or,
if no grace period is specified, 60 days;
(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, marshaling of assets and liabilities
or similar proceedings, or for the winding-up or liquidation of its
affairs, has been entered against the borrower and the decree or order
shall have remained in force undischarged or unstayed for 60 days;
(6) the borrower shall have consented to the appointment of a conservator
or receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings of or
relating to the borrower or of or relating to all or substantially all
of its property;
(7) the borrower has 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; and
(8) the servicer has received notice of the commencement of foreclosure or
similar proceedings with respect to the related mortgaged property or
properties.
A specially serviced mortgage loan will become a "corrected mortgage loan"
if each special servicing event that applies to that mortgage loan is remedied
as follows:
o for the circumstances described in clauses (1) and (2) of the
preceding paragraph, the related borrower has made the applicable
balloon payment or three consecutive full and timely monthly payments
under the terms of such mortgage loan (as the terms may be changed or
modified in a bankruptcy or similar proceeding involving the related
borrower or by reason of a modification, waiver or amendment granted
or agreed to by the servicer);
o for the circumstances described in clauses (3), (5), (6) and (7) of
the preceding paragraph, the circumstances cease to exist in the good
faith and reasonable judgment of the servicer;
o for the circumstances described in clause (4) of the preceding
paragraph, the default is cured; and
o for the circumstances described in clause (8) of the preceding
paragraph, the proceedings are terminated.
The servicer will be required to service and administer the respective
groups of related cross-collateralized mortgage loans as a single mortgage loan
as it deems necessary and appropriate, consistent with the servicing standard.
If any cross-collateralized mortgage loan becomes a specially serviced mortgage
loan, then each other mortgage loan that is cross-collateralized with it shall
also become a specially serviced mortgage loan. Similarly, no
cross-collateralized mortgage loan will subsequently become a corrected
mortgage loan, unless all special servicing events related to each other
mortgage loan that is cross-collateralized with it are corrected as described
in the preceding paragraph.
THE OPERATING ADVISER
An "operating adviser" appointed by the holders of a majority of the
controlling class will have the right to receive notification from the servicer
or any replacement special servicer in regard to certain actions. The servicer
or any replacement special servicer will be required to notify the operating
adviser of, among other things:
o any proposed modification of a monetary term of a mortgage loan other
than an extension of the original maturity date for two years or less;
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o any foreclosure or comparable conversion of the ownership of a
mortgaged property;
o any proposed sale of a specially serviced mortgage loan, other than in
connection with the termination of the trust fund as described in this
prospectus supplement under "Description of the Certificates--
Termination; Retirement of Certificates";
o any proposal to bring an REO property into compliance with applicable
environmental laws; and
o any acceptance of substitute or additional collateral for a mortgage
loan.
At any time, the holders of a majority of the controlling class may direct
the trustee in writing to hold an election for an operating adviser, which
election will be held commencing as soon as practicable thereafter or upon:
o the resignation or removal of the person acting as operating adviser;
or
o a determination by the trustee, based upon a written notice from the
certificate registrar, that the controlling class has changed.
All expenses of the operating adviser are required to be paid by the
controlling class.
TERMINATION OF THE SERVICER WITH RESPECT TO SPECIALLY SERVICED MORTGAGE
LOANS AND REO PROPERTIES
The holder or holders of certificates entitled to more than 50% of the
voting rights allocated to the controlling class may at any time terminate
substantially all of the rights and duties of the servicer to service specially
serviced mortgage loans and REO properties and appoint a "replacement special
servicer" to perform such duties under substantially the same terms and
conditions as applicable to the servicer. The holder(s) entitled to more than
50% of the voting rights allocated to the controlling class will designate a
replacement by delivering to the trustee a written notice stating such
designation. The trustee will, promptly after receiving that notice, notify the
rating agencies and the servicer. The "controlling class" will be the most
subordinate class of principal balance certificates outstanding, with the Class
A-1-a, Class A-1-b and Class A-2 certificates being treated as a single class
for this purpose, that has a certificate balance at least equal to 25% of its
initial certificate balance. If no class of principal balance certificates has
a certificate balance at least equal to 25% of its initial certificate balance,
then the most subordinate class will be the controlling class. Initially the
controlling class will be the Class N certificates. It is anticipated that the
servicer or an affiliate will acquire certain subordinate certificates,
including the Class N certificates.
The designated replacement will become the replacement special servicer as
of the date the trustee has received:
o written confirmation from each rating agency stating that if the
designated replacement were to serve as replacement special servicer
under the pooling and servicing agreement, none of the then-current
ratings of the outstanding classes of the certificates would be
qualified, downgraded or withdrawn as a result;
o a written acceptance of all obligations of a replacement special
servicer, executed by the designated replacement; and
o an opinion of counsel to the effect that the designation of the
replacement to serve as replacement special servicer is in compliance
with the pooling and servicing agreement, that the designated
replacement will be bound by the terms of the pooling and servicing
agreement and that the pooling and servicing agreement will be
enforceable against the designated replacement 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 in a proceeding in equity or at law.
The servicer will resign from its duties in respect of specially serviced
mortgage loans and REO properties simultaneously with the designated
replacement's becoming the replacement special servicer under the pooling and
servicing agreement. Any replacement special servicer may be similarly replaced
by the holder or holders of certificates entitled to more than 50% of the
voting rights allocated to the controlling class.
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Generally, a replacement special servicer will possess rights and
obligations comparable to those of a master servicer described in the
prospectus under "The Pooling and Servicing Agreements--Sub-Servicers,"
"--Evidence as to Compliance" and "--Certain Matters Regarding the Master
Servicer and the Depositor." A replacement special servicer will also be
responsible for performing the servicing and other administrative duties of the
servicer in this prospectus supplement or a master servicer under "The Pooling
and Servicing Agreements" in the prospectus, to the extent the duties relate to
specially serviced mortgage loans and REO properties.
Following any appointment of a replacement special servicer, the servicer
will continue to collect information and prepare all reports to the trustee and
to pay the trustee's fee based on the trustee fee rate provided in the pooling
and servicing agreement for any specially serviced mortgage loans and REO
properties. The servicer will also provide incidental services on specially
serviced mortgage loans and REO properties as required by the pooling and
servicing agreement. Unless the same person acts in the capacity as both
servicer and special servicer, the servicer and the replacement special
servicer shall not have any responsibility for the performance of each other's
duties under the pooling and servicing agreement.
The controlling class may have special relationships and interests that
conflict with those of the holders of one or more classes of certificates. In
addition, the controlling class does not have any duties to the holders of any
class of certificates. It may act solely in the interests of the
certificateholders of the controlling class and will have no liability to any
other certificateholders for having done so. No certificateholder may take any
action against the controlling class for having acted solely in the interests
of the certificateholders of the controlling class.
If the controlling class is represented by book-entry certificates, then
the rights of the holders of the controlling class may be exercised by the
relevant certificate owners subject to receipt by the trustee of a
certification in form and substance acceptable to the trustee stating that the
person exercising such rights is a certificate owner.
SERVICING AND OTHER COMPENSATION AND PAYMENT OF EXPENSES
The principal compensation to be paid to the servicer in respect of its
servicing activities generally will be the servicing fee, the special servicing
fee, the workout fee and the liquidation fee.
Servicing Fee
The "servicing fee" will be a fee payable monthly on a loan-by-loan basis
from amounts received or advanced for interest on each mortgage loan (including
specially serviced mortgage loans and mortgage loans as to which the related
mortgaged property has become an REO property). The servicing fee will accrue
at the servicing fee rate set forth as an annual percentage in Annex A for each
mortgage loan. A portion of the servicing fee on the mortgage loans identified
on Annex A as loan numbers 090001242 and 907881339 equal to 0.08% is to be paid
to the related sub-servicer of these mortgage loans and will be retained by
Archon Financial L.P. if that sub-servicer is terminated. The servicing fee
will be computed on the same basis and the same principal amount as any related
interest payment due or deemed due on the related mortgage loan is computed.
Special Servicing Fee
The "special servicing fee" will accrue solely for each specially serviced
mortgage loan and each mortgage loan for which the related mortgaged property
has become an REO property. The special servicing fee will accrue at a rate
equal to 0.25% per annum, on the same basis and the same principal amount as
any related interest payment due or deemed due on the mortgage loan is
computed, and will be payable monthly from general collections on the mortgage
loans then on deposit in the certificate account.
Workout Fee
A "workout fee" will generally be payable for each corrected mortgage
loan. For each corrected mortgage loan, the workout fee will be 1.0% of each
collection of interest and principal, including
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scheduled payments, prepayments, balloon payments and payments at maturity,
received on the mortgage loan for so long as it remains a corrected mortgage
loan. The workout fee for any corrected mortgage loan will cease to be payable
if the loan again becomes a specially serviced mortgage loan or if the related
mortgaged property becomes an REO property. However, a new workout fee will
become payable if the mortgage loan again becomes a corrected mortgage loan. If
the servicer is terminated other than for cause or resigns from any or all of
its servicing duties, it will retain the right to receive all workout fees
payable for mortgage loans that became corrected mortgage loans during the
period that it had responsibility for servicing specially serviced mortgage
loans and that were still corrected mortgage loans at the time of the
termination or resignation. The successor servicer or replacement special
servicer will not be entitled to any portion of these workout fees, in each
case until the workout fee for any such loan ceases to be payable in accordance
with the preceding sentence.
Liquidation Fee
A "liquidation fee" will be payable for each specially serviced mortgage
loan for which the servicer obtains a full or discounted payoff from the
related borrower and, except as described below, for each specially serviced
mortgage loan or REO property for which the servicer receives any liquidation
proceeds. For each of these specially serviced mortgage loans and REO
properties, the liquidation fee will be 1.0% of the related payment or
proceeds. No liquidation fee will be payable on liquidation proceeds received
from the purchase of any specially serviced mortgage loan or REO property by
the servicer, a replacement special servicer or any holder of certificates
evidencing a majority interest in the controlling class or the purchase of all
of the mortgage loans and REO properties by the servicer or the depositor as a
result of the termination of the trust. If, however, liquidation proceeds are
received on any corrected mortgage loan and the servicer is properly entitled
to a workout fee, the workout fee will be payable based on the portion of such
liquidation proceeds that constitute principal and/or interest.
Additional Compensation
The servicer will be entitled to all assumption and modification fees,
late payment charges, charges for beneficiary statements or demands, amounts
collected for checks returned for insufficient funds, and any similar or
ancillary fees, in each case to the extent actually paid by a borrower under a
mortgage loan.
The servicer will be entitled to prepayment interest excesses and balloon
payment interest excesses collected on the mortgage loans. The servicer will
also be entitled to any default interest actually collected on the mortgage
loans that is not allocable to cover interest on any advances made in respect
of the related mortgage loan.
Generally, if a borrower voluntarily prepays a mortgage loan, in whole or
in part, after the due date in any collection period, the amount of interest,
net of related servicing fees and, if applicable, excess interest, accrued on
the prepayment from that due date to, but not including, the date of prepayment
or any later date through which interest accrues will, to the extent actually
collected, constitute a "prepayment interest excess." Conversely, if a borrower
prepays a mortgage loan, in whole or in part, before the due date in any
collection period and does not pay interest on that prepayment through the due
date, then the shortfall in a full month's interest net of related servicing
fees and, if applicable, excess interest on such prepayment will constitute a
"prepayment interest shortfall."
Similarly, if the due date for any balloon payment occurs after the normal
due date in any collection period, the amount of interest net of related
servicing fees and, if applicable, excess interest accrued on the related
balloon loan from such normal due date to the maturity date will, to the extent
actually collected in connection with the payment of such balloon payment on or
before the succeeding determination date, constitute a "balloon payment
interest excess." Conversely, if the due date for any balloon payment occurs
before the due date for monthly payments in any collection period, the amount
of interest net of related servicing fees and, if applicable, excess interest
that would have accrued on the related balloon loan from the stated maturity
date through such due date will, to the extent not paid by the borrower,
constitute a "balloon payment interest shortfall." Prepayment interest excesses
and balloon payment interest excesses collected on the mortgage loans will be
retained by the servicer as additional servicing compensation.
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If any mortgage loan with a due date after the determination date in any
month is prepaid in full or in part, including, without limitation, an early
balloon payment during any collection period, and such prepayment is applied to
such mortgage loan before such mortgage loan's due date in the next succeeding
collection period, the amount of interest that would have accrued at the
related net mortgage rate on the amount of such prepayment from the date as of
which such prepayment was received to but not including the due date of such
mortgage loan in the next succeeding collection period, to the extent not
collected from the related borrower without regard to any prepayment premium or
excess interest that may have been collected, and to the extent that any
portion thereof does not represent a balloon payment interest shortfall, will
constitute an "extraordinary prepayment interest shortfall." The servicer will
cover, out of its own funds, any balloon payment interest shortfalls,
prepayment interest shortfalls and extraordinary prepayment interest shortfalls
incurred on the mortgage loans during any collection period; provided, however,
that with respect to those mortgage loans having due dates which fall on or
before the determination date, the servicer will cover prepayment interest
shortfalls only to the extent of its aggregate master servicing fee for the
same collection period calculated for all mortgage loans at a rate equal to the
"master servicing fee rate" of 0.02% per annum.
The servicer will be authorized to invest or direct the investment of
funds held in any and all accounts maintained by it that constitute part of the
certificate account, the interest reserve account and the REO account, if
established. Any replacement special servicer will be authorized to invest or
direct the investment of funds held in the REO account, if established. The
servicer and replacement special servicer, respectively, will be entitled to
retain any interest or other income earned on such funds, but will be required
to cover any losses from its own funds without any right to reimbursement. The
servicer and replacement special servicer will have these rights and
obligations whether or not the servicer or replacement special servicer, as
applicable, actually directs the investment of such funds.
As compensation for performing its duties for specially serviced mortgage
loans and REO properties, a replacement special servicer will be entitled to
receive all special servicing fees, liquidation fees and, except as otherwise
described above, workout fees otherwise payable to the servicer for performing
those duties. A replacement special servicer will also be entitled to any
default interest actually collected on the mortgage loans that is allocable to
the period that the mortgage loan constituted a specially serviced mortgage
loan and that is not allocable to cover interest on any advances made on the
mortgage loan.
Generally, the servicer and any replacement special servicer will be
required to pay their respective overhead and general and administrative
expenses incurred as a result of servicing activities under the pooling and
servicing agreement, including the fees of any sub-servicers retained by it.
The servicer and any replacement special servicer will not be entitled to
reimbursement for these expenses unless expressly provided in the pooling and
servicing agreement. Servicing advances will be reimbursable from future
payments and other collections, including in the form of "related proceeds"
consisting of liquidation proceeds, insurance proceeds and condemnation
proceeds, in any event on or in respect of the related mortgage loan or REO
property. "Servicing advances" generally include customary, reasonable and
necessary out-of-pocket costs and expenses incurred by the servicer or a
replacement special servicer as a result of the servicing of a mortgage loan
after a default, delinquency or other unanticipated event or a mortgage loan on
which a default is imminent, or in connection with the administration of any
REO property. Servicing advances and P&I advances are referred to as
"advances."
The servicer and any replacement special servicer will each be permitted
to pay, or to direct the payment of, certain servicing expenses directly out of
the certificate account or the REO account, as applicable. Payments for some
servicing expenses (such as remediation of any adverse environmental
circumstance or condition at a mortgaged property or REO property) may be made
without regard to the relationship between the expense and the funds from which
it is being paid. The servicer, however, may instead advance the costs thereof.
If any replacement special servicer is required under the pooling and
servicing agreement to make any servicing advance but does not desire to do so,
the replacement special servicer may, in its sole discretion, request that the
servicer make such advance. The request must be made in writing and in a timely
manner that does not adversely affect the interests of any certificateholder.
The servicer is required
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to make any servicing advance other than a nonrecoverable advance or an advance
that would be in violation of the servicing standard requested by a replacement
special servicer within ten days of the servicer's receipt of the request. A
replacement special servicer will have no obligation to make an advance that it
requests the servicer to make.
If the servicer or a replacement special servicer is required under the
pooling and servicing agreement to make a servicing advance, but does not do so
within 15 days after the servicing advance is required to be made, then the
trustee will, if it has actual knowledge of the failure, be required to make
the servicing advance. The servicer, any replacement special servicer and the
trustee are required to make servicing advances only to the extent that the
servicing advances are, in the reasonable and good faith judgment of that
person, ultimately recoverable from related proceeds.
As described in this prospectus supplement, the servicer, any replacement
special servicer and the trustee are each entitled to receive interest at the
reimbursement rate on servicing advances. The servicing fee includes the
compensation of the trustee which will be withdrawn by the trustee from the
distribution account. See "The Pooling and Servicing Agreements--Certificate
Account" and "--Servicing Compensation and Payment of Expenses" in the
prospectus and "Description of the Certificates--P&I Advances" in this
prospectus supplement.
MODIFICATIONS, WAIVERS, AMENDMENTS AND CONSENTS
The servicer 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 borrower on or any guarantor of any mortgage loan without the
consent of the trustee or any certificateholder, subject, however, to each of
the following limitations, conditions and restrictions:
(1) with limited exception, the servicer may not agree to
o any modification, waiver or amendment of any term of, or take any of
the other actions described above on any mortgage loan that would
affect the amount or timing of any related payment of principal,
interest or other amount payable thereunder or affect the obligation
of the related borrower to pay a prepayment premium or permit a
principal prepayment during the applicable lockout period or, in the
servicer's good faith and reasonable judgment, would materially impair
the security for the mortgage loan or reduce the likelihood of timely
payment of amounts due thereon, unless, in the servicer's 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 the modification, waiver, amendment or other action is reasonably
likely to produce a greater recovery to certificateholders on a
present value basis than would liquidation;
(2) the servicer may not extend the maturity of any mortgage loan beyond the
date that is two years before the distribution date in August, 2036, the
"rated final distribution date" and, in any event, may not permit one or
more extensions of the original maturity date of any mortgage loan that
would, in the aggregate, extend the original maturity of that mortgage loan
by more than five years;
(3) the servicer will not make or permit any modification, waiver or amendment
of any term of, or take any of the other above-referenced actions on, any
mortgage loan that would:
o cause any of REMIC I, REMIC II or REMIC III to fail to qualify as a
REMIC under the Code or, except as otherwise described under "--REO
Properties" below, result in the imposition of any tax on "prohibited
transactions" or "contributions" after the startup date of any such
REMIC under the REMIC Provisions, or
o cause any mortgage loan to cease to be a "qualified mortgage" within
the meaning of Section 860G(a)(3) of the Code (provided that the
servicer will not be liable for decisions related to the status of a
mortgage loan on a "qualified mortgage" that are made in good faith
and, unless it would constitute bad faith or negligence to do so, the
servicer may rely on opinions of counsel in making these decisions);
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(4) the servicer will not permit any borrower to add or substitute any
collateral for an outstanding mortgage loan, if the collateral constitutes
real property, unless the servicer has first determined in its good faith
and reasonable judgment, based upon a Phase I environmental assessment and
the additional environmental testing as the servicer deems necessary and
appropriate, that the additional or substitute collateral is in compliance
with applicable environmental laws and regulations and that there are no
circumstances or conditions present related 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
(5) with limited exceptions, the servicer may not release any collateral
securing an outstanding mortgage loan;
provided that:
o the limitations, conditions and restrictions in clauses (1) through
(5) above will not apply to any modification of any term of any
mortgage loan that is required under the terms of the mortgage loan in
effect on the delivery date or that is solely within the control of
the related borrower, and
o the servicer will not be required to oppose the confirmation of a plan
in any bankruptcy or similar proceeding involving a borrower, if in
its reasonable and good faith judgment, such opposition would not
ultimately prevent the confirmation of such plan or one substantially
similar.
ENFORCEMENT OF ARD LOANS
With respect to ARD loans, the servicer and any replacement special
servicer may 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 ARD loan. The foregoing will not limit the servicer's or
replacement special servicer's obligation to direct the related borrower to
establish a lockbox account under the provisions of the pooling and servicing
agreement.
SALE OF DEFAULTED MORTGAGE LOANS
The pooling and servicing agreement grants to the servicer, any
replacement special servicer and the holder or holders of certificates
evidencing a majority interest in the controlling class a right to purchase
from the trust certain defaulted mortgage loans. If the servicer has
determined, in its good faith and reasonable judgment, that any defaulted
mortgage loan will become the subject of a foreclosure, the servicer will be
required to promptly notify in writing the trustee. Within 10 days after
receipt of that notice, the trustee will notify the holders of the controlling
class. Any holder or holders of certificates evidencing a majority interest in
the controlling class may purchase any such defaulted mortgage loan from the
trust for a price equal to the purchase price. If those certificateholders have
not purchased the defaulted mortgage loan within 15 days after they received
notice, either the servicer or any replacement special servicer may purchase
the defaulted mortgage loan from the trust, at a price equal to the purchase
price. If neither the servicer nor the replacement special servicer purchases
the defaulted mortgage loan, the servicer may offer to sell the defaulted
mortgage loan if the servicer determines, consistent with the servicing
standard, that a sale would be in the best economic interests of the trust. The
offer to sell is to be made in a commercially reasonable manner for a period of
not less than 10 days or more than 90 days. Unless the servicer determines that
acceptance of any offer would not be in the best economic interests of the
trust, the servicer will accept the highest cash offer received from any person
that constitutes a fair price even if that offer is for less than the purchase
price. However, none of the servicer, any replacement special servicer, the
depositor, the holder of any certificate or any of their affiliates may
purchase the mortgage loan for less than the purchase price unless it is the
highest bid received and at least two other offers are received from
independent third parties. See also "The Pooling and Servicing Agreements--
Realization Upon Defaulted Mortgage Loans" in the prospectus.
REO PROPERTIES
Generally, the servicer will be obligated to or may contract with a third
party to operate and manage any mortgaged property acquired as REO property in
a manner that would, in its good faith and
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reasonable judgment and to the extent commercially feasible, maximize the
trust's net after-tax proceeds from the REO property. After the servicer
reviews the operation of the REO property and consults with the trustee to
determine the trust's federal income tax reporting position with respect to
income it is anticipated that the trust would derive from such property, the
servicer could determine that it would not be commercially feasible to manage
and operate the property in a manner that would avoid the imposition of a tax
on "net income from foreclosure property" within the meaning of the REMIC
Provisions or a tax on "prohibited transactions" under Section 860F of the Code
(either such tax referred to in this prospectus supplement as an "REO tax").
To the extent that income the trust receives from an REO property is
subject to a tax on (1) "net income from foreclosure property," such income
would be subject to federal tax at the highest marginal corporate tax rate and
(2) "prohibited transactions," such income would be subject to federal tax at a
100% rate. The determination as to whether income from an REO property would be
subject to an REO tax will depend on the specific facts and circumstances
relating to the management and operation of each REO property.
Generally, income from an REO property that is directly operated by the
servicer would be apportioned and classified as "service" or "non-service"
income. The "service" portion of that income could be subject to federal tax
either at the highest marginal corporate tax rate or at the 100% rate on
"prohibited transactions," and the "non-service" portion of that income could
be subject to federal tax at the highest marginal corporate tax rate or,
although it appears unlikely, at the 100% rate applicable to "prohibited
transactions." Any REO tax imposed on the trust's income from an REO property
would reduce the amount available for distribution to certificateholders.
Certificateholders are advised to consult their tax advisors regarding the
possible imposition of REO taxes resulting from the operation of commercial REO
properties by REMICs. The servicer will be required to sell any REO property
acquired on behalf of the trust within the time period and in the manner
described under "The Pooling and Servicing Agreements--Realization Upon
Defaulted Mortgage Loans" in the prospectus.
The servicer, or, if appointed, the replacement special servicer, will
establish and maintain one or more eligible REO accounts, to be held on behalf
of the trustee in trust for the benefit of the certificateholders, for the
retention of revenues, net liquidation proceeds (other than excess liquidation
proceeds) and insurance proceeds derived from each REO property. The servicer
or replacement special servicer, as applicable, will use the funds in the REO
account to pay for the proper operation, management, maintenance, disposition
and liquidation of any REO property, but from amounts on deposit in the REO
account that relate to the REO property. If amounts in the REO account in
respect of any REO property are insufficient to make such payments, the
servicer or replacement special servicer will make a servicing advance to cover
any insufficiency, unless it determines the servicing advance would be
nonrecoverable. Within one business day following the end of each collection
period, the servicer or replacement special servicer will deposit all amounts
collected or received for each REO property during the collection period, net
of any amounts withdrawn to make any permitted disbursements, into the
certificate account. The servicer and the replacement special servicer,
however, may retain permitted reserves in the REO account.
INSPECTIONS; COLLECTION OF OPERATING INFORMATION
The servicer is required to or may contract with a third party to perform
physical inspections of each mortgaged property at least once every two years
or, if the related mortgage loan has a then-current balance greater than
$2,000,000, at least once every year. In addition, the servicer, subject to
statutory limitations or limitations in the related loan documents, is required
to perform a physical inspection of each mortgaged property as soon as
practicable after the mortgage loan becomes a specially serviced mortgage loan.
The servicer will be required to prepare or cause to be prepared a written
report of each such inspection performed that describes the condition of the
mortgaged property.
For each mortgage loan that requires the borrower to deliver operating
statements for the related mortgaged property, the servicer will also make
reasonable efforts to collect and review those statements. However, any
operating statements required to be delivered may not in fact be delivered, and
the servicer is not likely to have any practical means of compelling delivery
if the mortgage loan is not in default.
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YEAR 2000 COMPLIANCE
The servicer agrees that by August 31, 1999, any custom-made software or
hardware designed, purchased or licensed by the servicer and used in the course
of the operation or management of, or the compiling, reporting or generation of
data will not contain any deficiency
o in the ability of the software or hardware to identify correctly or
perform calculations or other processing with respect to dates after
December 31, 1999, or
o that would cause the software or hardware to no longer be fit for the
purpose for which it was intended due to the changing of the year from
1999 to 2000.
DESCRIPTION OF THE CERTIFICATES
The certificates will be issued under the pooling and servicing agreement
and will represent in the aggregate the entire beneficial ownership interest in
the trust consisting of:
(1) the mortgage loans and all payments under and proceeds of the mortgage
loans received after the cut-off date for such mortgage loan
(exclusive of payments of principal and interest due on or before the
cut-off date for such mortgage loan);
(2) any mortgaged property acquired on behalf of the certificateholders
through foreclosure, deed in lieu of foreclosure or otherwise (upon
acquisition, an "REO property");
(3) the funds or assets that are deposited in the certificate account, any
REO account and the interest reserve account;
(4) the rights of the mortgagee under all insurance policies relating to
the mortgage loans; and
(5) rights of the depositor under the mortgage loan purchase agreements
relating to mortgage loan document delivery requirements and the
representations and warranties of the sellers regarding the mortgage
loans.
DENOMINATIONS
The trust will offer the offered certificates other than the Class X
certificates in minimum denominations of $25,000 and multiples of $1 in excess
thereof. The trust will offer the Class X certificates in minimum denominations
of $1,000,000 initial notional amount and multiples of $1 in excess thereof.
Each class of offered certificates will initially be represented by one or
more global certificates registered in the name of the nominee of DTC. The
depositor has been informed by DTC that DTC's nominee initially will be Cede &
Co. No certificate owner will be entitled to receive a definitive certificate
representing its interest in a class of offered certificates, except as
described below under "--Book-Entry Registration of the Offered
Certificates--Definitive Certificates."
Unless and until definitive certificates are issued in respect of any
class of offered certificates, all references to actions by holders of the
offered certificates will refer to actions taken by DTC upon instructions
received from the related certificate owners through its participants, and all
references in this prospectus supplement to payments, notices, reports and
statements to holders of the offered certificates will refer to payments,
notices, reports and statements to DTC or Cede & Co., as the registered holder
of the offered certificates, for distribution to the related certificate owners
through its participants under DTC's procedures. Until definitive certificates
are issued for any class of offered certificates, interests in those
certificates will be transferred on the book-entry records of DTC and its
participants. The certificate owners may hold their certificates through DTC,
in the United States, or Cedelbank or Euroclear, in Europe, through
participants in such systems, or indirectly through organizations which are
participants in such systems. See "Description of the Certificates--Book-Entry
Registration and Definitive Certificates" in the prospectus.-
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BOOK-ENTRY REGISTRATION OF THE OFFERED CERTIFICATES
Certificate owners that are not direct or indirect participants but desire
to purchase, sell or otherwise transfer ownership of, or other interests in,
the offered certificates may do so only through direct and indirect
participants. In addition, certificate owners will receive all payments on
their offered certificates from the trustee through DTC and its direct and
indirect participants. Accordingly, certificate owners may experience delays in
their receipt of payments. Unless definitive certificates are issued for any
class, the only registered certificateholder of the offered certificates will
be Cede & Co., as nominee of DTC. Certificate owners will not be recognized by
the trustee or the servicer as certificateholders. Except under the limited
circumstances described in this prospectus supplement, certificate owners will
be permitted to receive information furnished to certificateholders and to
exercise the rights of certificateholders only indirectly through DTC and its
direct and indirect participants.
Under the rules, regulations and procedures regarding DTC and its
operations, DTC is required to make book-entry transfers of the offered
certificates among participants and to receive and transmit payments on the
offered certificates. Direct and indirect participants similarly are required
to make book-entry transfers and receive and transmit payments on behalf of
their respective certificate owners. Although certificate owners will not hold
physical certificates evidencing their interests in the offered certificates,
the DTC rules, regulations and procedures provide a mechanism by which
certificate owners, through their direct and indirect participants, will
receive payments and will be able to transfer their interests in the offered
certificates.
None of the servicer, the trustee or the depositor will have any liability
for any actions taken by DTC or its nominee, including, without limitation,
actions for any aspect of the records relating to or payments made on account
of beneficial ownership interests in the offered certificates held by Cede &
Co., as nominee for DTC, or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interest.
Euroclear and Cedelbank
The offered certificates will be initially issued to investors through the
book-entry facilities of DTC, or Cedelbank or the Euroclear system in Europe if
the investors are participants of those systems, or indirectly through
organizations that are participants in such systems. For any of these classes
of offered certificates, the record holder will be DTC's nominee. Cedelbank and
Euroclear will hold omnibus positions on behalf of their participants through
customers' securities accounts in Cedelbank's and Euroclear's names on the
books of their respective depositories (the "depositories"). The depositories
in turn, will hold such positions in customers' securities accounts in the
depositories' names on the books of DTC.
Because of time zone differences, the securities account of a Cedelbank or
Euroclear participant as a result of a transaction with a participant (other
than a depositary holding on behalf of Cedelbank or Euroclear) will be credited
during the securities settlement processing day (which must be a business day
for Cedelbank or Euroclear, as the case may be) immediately following the DTC
settlement date. These credits or any transactions in the securities settled
during the processing will be reported to the relevant Euroclear participant or
Cedelbank participant on that business day. Cash received in Cedelbank or
Euroclear as a result of sales of securities by or through a Cedelbank
participant or Euroclear participant to a DTC Participant (other than the
depository for Cedelbank or Euroclear) will be received with value on the DTC
settlement date, but will be available in the relevant Cedelbank or Euroclear
cash account only as of the business day following settlement in DTC.
Transfers between Participants will occur in accordance with DTC rules.
Transfers between Cedelbank participants or Euroclear participants will occur
in accordance with their respective rules and operating procedures.
Cross-market transfers between persons holding directly or indirectly
through DTC, on the one hand, and directly or indirectly through Cedelbank
participants or Euroclear participants, on the other, will be effected in DTC
in accordance with DTC rules on behalf of the relevant European international
clearing system by the relevant depositories; however, such cross-market
transactions will require delivery of
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instructions to the relevant European international clearing system by the
counterparty in such system in accordance with its rules and procedures and
within its established deadlines (European time). The relevant European
international clearing system will, if the transaction meets its settlement
requirements, deliver instructions to its depository to take action to effect
final settlement on its behalf by delivering or receiving securities in DTC,
and making or receiving payment in accordance with normal procedures for same
day funds settlement applicable to DTC. Cedelbank participants or Euroclear
participants may not deliver instructions directly to the depositories.
Cedelbank, as a professional depository, holds securities for its
participating organizations ("Cedelbank participants") and facilitates the
clearance and settlement of securities transactions between Cedelbank
participants through electronic book-entry changes in accounts of Cedelbank
participants, thereby eliminating the need for physical movement of
certificates. As a professional depository, Cedelbank is subject to regulation
by the Luxembourg Monetary Institute.
Euroclear was created to hold securities for participants of Euroclear
("Euroclear participants") and to clear and settle transactions between
Euroclear participants through simultaneous electronic book-entry delivery
against payment, thereby eliminating the need for physical movement of
certificates and any risk from lack of simultaneous transfers of securities and
cash. Euroclear is operated by the Brussels, Belgium office of Morgan Guaranty
Trust Company of New York (the "Euroclear operator"), under contract with
Euroclear Clearance Systems S.C., a Belgian co-operative corporation (the
"clearance cooperative"). All operations are conducted by the Euroclear
operator, and all Euroclear securities clearance accounts and Euroclear cash
accounts are accounts with the Euroclear operator, not the clearance
cooperative. The clearance cooperative establishes policies for Euroclear on
behalf of Euroclear's participants. The Euroclear operator is the Belgian
branch of a New York banking corporation which is a member bank of the Federal
Reserve System. As such, it is regulated and examined by the Board of Governors
of the Federal Reserve System and the New York State Banking Department, as
well as the Belgian Banking Commission. Securities clearance accounts and cash
accounts with the Euroclear operator are governed by the Terms and Conditions
Governing Use of Euroclear and the related operating procedures of the
Euroclear system and applicable Belgian law (collectively, the "terms and
conditions"). The terms and conditions govern transfers of securities and cash
within Euroclear, withdrawals of securities and cash from Euroclear, and
receipts of payments with respect to securities in Euroclear. All securities in
Euroclear are held on a fungible basis without attribution of specific
certificates to specific securities clearance accounts.
Distributions in respect of the offered certificates will be forwarded by
the trustee to DTC, and DTC will be responsible for forwarding such payments to
participants, each of which will be responsible for disbursing such payments to
the certificate owners it represents or, if applicable, to indirect
participants. Accordingly, certificate owners may experience delays in the
receipt of payments in respect of their certificates. Under DTC's procedures,
DTC will take actions permitted to be taken by holders of any class of offered
certificates under the pooling and servicing agreement only at the direction of
one or more participants to whose account such offered certificates are
credited and whose aggregate holdings represent no less than any minimum amount
of percentage interests or voting rights required therefor. DTC may take
conflicting actions with respect to any action of certificateholders of any
class to the extent that participants authorize such actions. None of the
depositor, the trustee or any of their respective affiliates will have any
liability for any aspect of the records relating to, or payments made on
account of, beneficial ownership interests in the offered certificates or for
maintaining, supervising or reviewing any records relating to such beneficial
ownership interests.
Certificate owners will not be recognized by the trustee or servicer as
certificateholders, as such term is used in the pooling and servicing
agreement; provided, however, that certificate owners will be permitted to
request and receive information furnished to certificateholders by the trustee
subject to receipt by the trustee of a certification in form and substance
acceptable to the trustee stating that the person requesting such information
is a certificate owner.
Although DTC, Cedelbank and Euroclear have agreed to the foregoing
procedures to facilitate transfers of the offered certificates among
participants of DTC, Cedelbank and Euroclear, they are under no obligation to
perform or continue to perform such procedures and such procedures may be
discontinued at any time. See Annex D hereto.
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Year 2000
DTC has informed its participants and other members of the financial
community that it has developed and is implementing a program to deal with the
"year 2000 problem" so that its systems, as the same relate to the timely
payment of distributions to certificateholders, book-entry deliveries, and
settlement of trades within DTC, continue to function appropriately.
Definitive Certificates
Definitive certificates will be issued to certificate owners or their
nominees, respectively, rather than to DTC or its nominee, only under the
limited conditions described in the prospectus under "Description of the
Certificates--Book-Entry Registration and Definitive Certificates."
Upon the occurrence of an event described in the prospectus in the last
paragraph under "Description of the Certificates--Book-Entry Registration and
Definitive Certificates," the trustee is required to notify, through DTC,
direct participants who have ownership of offered certificates as indicated on
the records of DTC, of the availability of definitive certificates with respect
thereto. Upon surrender by DTC of the physical certificates registered in the
name of its nominee and representing the offered certificates and upon receipt
of instructions from DTC for re-registration, the trustee will reissue the
respective classes of offered certificates as definitive certificates issued in
the respective principal or notional amounts owned by individual certificate
owners of each such class, and thereafter the trustee and the servicer will
recognize the holders of such definitive certificates as certificateholders.
For additional information regarding DTC and certificates maintained on
the book-entry records thereof, see "Description of the
Certificates--Book-Entry Registration and Definitive Certificates" in the
prospectus.
CERTIFICATE BALANCES AND NOTIONAL AMOUNTS
On each distribution date, the certificate balance of each class of
certificates with a certificate balance ("principal balance certificates") will
be reduced by any distributions of principal actually made on such class of
certificates on such distribution date. Those certificates' balances will be
further reduced by any realized losses and additional trust expenses allocated
to such class of certificates on such distribution date.
The Class X certificates will not have a certificate balance. The Class X
certificates will represent the right to receive distributions of interest
accrued as described in this prospectus supplement on a notional amount equal
to the aggregate certificate balance of the principal balance certificates
outstanding from time to time. The Class X certificates will have an initial
notional amount of $1,152,022,048 (subject to a variance of plus or minus 5%).
The Class X certificates consist of 15 components each corresponding to a
different class of principal balance certificates (the "Class X components").
No class of REMIC residual certificates will have a certificate balance.
PASS-THROUGH RATES
The annual rate at which any class of certificates accrues interest from
time to time is referred to as its "pass-through rate."
The pass-through rate applicable to the Class A-1-a certificates will be
fixed and, at all times, will be equal to the pass-through rate specified for
such class on page S-4. The pass-through rate applicable to the Class A-1-b,
A-2, B and C certificates for any distribution date will be equal to the lesser
of the specified fixed rate described in footnote 8 on page S-4 and the
weighted average net mortgage rate with respect to such distribution date. The
pass-through rates applicable to the Class D, E and F certificates for any
distribution date will be equal to the weighted average net mortgage rate with
respect to such distribution date. The pass-through rate applicable to the
Class X certificates for the initial distribution date will equal approximately
0.5328% per annum. The pass-through rate applicable to the Class X certificates
for any distribution date will be variable and will be equal to the weighted
average (by certificate balance of the corresponding class of principal balance
certificates) of the pass-through rates then applicable to each
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Class X component. The pass-through rate of each Class X component for any
distribution date will equal the excess, if any, of the weighted average net
mortgage rate for that distribution date over the pass-through rate for that
distribution date applicable to the related class of principal balance
certificates. If a class of principal balance certificates has a pass-through
rate equal to the weighted average net mortgage rate, the pass-through rate of
the related Class X component will be zero. The pass-through rates for the
Class G, H, J, K, L, M and N certificates for any distribution date will be
equal to the lesser of a specified fixed rate and the weighted average net
mortgage rate for that distribution date. No class of REMIC residual
certificates will have a specified pass-through rate.
The "weighted average net mortgage rate" for each distribution date is the
weighted average of the net mortgage rates for the mortgage loans as of the
beginning of the related collection period, weighted on the basis of their
respective stated principal balances outstanding immediately before such
distribution date.
The "net mortgage rate" for any mortgage loan is, generally, an annual
rate equal to the related mortgage rate in effect from time to time, minus the
servicing fee rate. However, for purposes of calculating pass-through rates,
the net mortgage rate for any mortgage loan will be determined without regard
to any modification, waiver or amendment of the terms of the mortgage loan,
whether agreed to by the servicer or resulting from a bankruptcy, insolvency or
similar proceeding involving the related borrower or the application of the
revised rate to any ARD loan.
If any mortgage loan does not accrue interest on the basis of a 360-day
year consisting of twelve 30-day months, which is the basis on which interest
accrues in respect of the REMIC regular certificates, then, for purposes of
calculating pass-through rates, the net mortgage rate of that mortgage loan for
any one-month period before a related due date will be equal to:
o the annualized rate at which interest would have to accrue on the loan on
the basis of a 360-day year consisting of twelve 30-day months to produce
the aggregate amount of interest actually accrued in respect of such loan
during such one-month period at the related mortgage rate minus the related
"servicing fee rate" for that mortgage loan specified on Annex A;
however, for each interest reserve loan,
o the net mortgage rate for the one-month period before the due dates in
o January and February in each year that is not a leap year or
o February only in each year that is a leap year
will be determined net of the withheld amounts, and
o the net mortgage rate for the one-month period before the due date in
March will be determined after taking into account the addition of the
withheld amounts with respect to each such mortgage loan.
See "Servicing of the Mortgage Loans--Servicing and Other Compensation and
Payment of Expenses" and "--Modifications, Waivers, Amendments and Consents" in
this prospectus supplement.
The "stated principal balance" of each mortgage loan will generally equal
its cut-off date balance, or for a replacement mortgage loan, the outstanding
principal balance as of the related date of substitution, reduced to not less
than zero on each distribution date by
o any payments or other collections or advances of principal of the mortgage
loan that have been or, if they had not been applied to cover additional
trust expenses, would have been distributed on the certificates on such
date, and
o the principal portion of any realized loss incurred on or allocable to the
mortgage loan during the related collection period.
The "determination date" will be the 5th day of each month or, if any such
5th day is not a business day, the next business day.
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DISTRIBUTIONS
The trustee will make distributions on certificates, to the extent of
available funds, on each distribution date. Except as otherwise described
below, the trustee will make these distributions to the persons in whose names
the certificates are registered on the record date, which is the close of
business on the last business day of the preceding month. The trustee will make
these distributions by wire transfer in immediately available funds to the
account specified by the certificateholder at a bank or other entity, if the
certificateholder has given the trustee wiring instructions at least five
business days before the related record date. Distributions not made by wire
transfer will be made by check mailed to such certificateholder.
The final distribution on any certificate (determined without regard to
any possible future reimbursement of any realized losses or additional trust
expense previously allocated to that certificate) will also be made by wire
transfer or check, but only upon presentation and surrender of such certificate
at the location that will be specified in a notice of the final distribution.
In the unlikely case of any distribution made on a certificate to reimburse a
realized loss or additional trust expense after the date the certificate is
surrendered, the distribution will be made by check mailed to the
certificateholder that surrendered the certificate. All distributions made on a
class of certificates will be allocated pro rata among those certificates based
on their respective percentage interests in that class.
Loan Groups
For purposes of calculating distributions on the senior certificates, the
mortgage pool has been divided into loan group 1 and loan group 2. The "group 1
mortgage loans" consists of 99 mortgage loans representing 77.45% of the
initial pool balance, and the "group 2 mortgage loans" consists of 39 mortgage
loans or representing 22.55% of the initial pool balance. "Loan group 2"
includes all of the multifamily loans, and "loan group 1" includes all the
mortgage loans not otherwise included in loan group 2.
The Available Distribution Amount
The amount of funds that will be available for distribution to
certificateholders on each distribution date is the "available distribution
amount" for that distribution date, and will generally equal:
(1) all amounts on deposit in the certificate account as of the close of
business on the related determination date, excluding any portion
thereof that represents one or more of the following:
o monthly payments collected but due on a due date after the
related collection period;
o prepayment premiums;
o amounts that are payable or reimbursable to any person other than
the certificateholders, including amounts payable to the
servicer, any replacement special servicer or the trustee as
compensation or to reimburse outstanding advances and amounts
payable for additional trust expenses;
o amounts deposited in the certificate account in error;
o for any distribution date in February, and in any January in a
year that is not a leap year, the withheld amounts for the
interest reserve loans to be deposited in the interest reserve
account and held for future distribution; and
o amounts that represent excess interest or excess liquidation
proceeds; plus
(2) to the extent not already included in clause (1), any P&I advances
made for that distribution date and payments made by the servicer to
cover prepayment interest shortfalls, balloon payment interest
shortfalls and extraordinary prepayment interest shortfalls incurred
during the related collection period; plus
(3) for the distribution date occurring in each March, the withheld
amounts for the interest reserve loans then on deposit in the interest
reserve account as described under "--Interest Reserve Account" below;
plus
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(4) for any mortgage loan with a due date after the determination date in
each month, the monthly payment, other than any balloon payment, due
in the same month as that distribution date if received by the related
due date in that month.
See "The Pooling and Servicing Agreements--Certificate Account" in the
prospectus.
For purposes of making distributions on the senior certificates on any
distribution date, the available distribution amount for such date will be
divided into the loan group 1 distribution amount and the loan group 2
distribution amount. The "loan group 1 distribution amount" for any
distribution date will consist of all amounts included in the available
distribution amount for such date that are attributable to the mortgage loans
constituting loan group 1, and the "loan group 2 distribution amount" for any
distribution date will consist of all amounts included in the available
distribution amount for such date that are attributable to the mortgage loans
constituting loan group 2.
Application of the Available Distribution Amount
In general, distributions of interest and principal are to be made to the
holders of the various classes of REMIC regular certificates sequentially based
on their relative seniority. Accordingly, the trustee will make distributions
of interest and principal on the senior certificates prior to making such
distributions in respect of any other class of REMIC regular certificates.
On each distribution date, the trustee will apply the available
distribution amount for that date in the order of priority set forth below.
Distributions of Interest and Principal on the Senior Certificates
On each distribution date prior to the earlier of the Class A principal
distribution cross-over date and the final distribution date in connection with
the termination of the trust, the trustee will (except as described below)
apply the portion of the loan group 1 distribution amount indicated below for
such date for the following purposes and in the following order of priority:
(1) to pay interest to the holders of the Class A-1-a, Class A-1-b and
Class X certificates, pro rata as among such classes in accordance
with the amount of unpaid distributable certificate interest accrued
in respect of such class of certificates (or, in the case of the Class
X certificates, the portion thereof that accrued on components A-1-a
and A-1-b of such class' notional amount) through the end of the
related interest accrual period up to an amount equal to the lesser of
(a) the amount of such unpaid distributable certificate interest
accrued in respect of such class and (b) 39% of the loan group 1
distribution amount for such distribution date;
(2) to pay principal to the holders of the Class A-1-a certificates, up to
an amount equal to the lesser of (a) the then outstanding certificate
balance of such class of certificates and (b) 39% of the loan group 1
principal amounts for such distribution date;
(3) if the certificate balance of the Class A-1-a certificates has been
reduced to zero, to pay principal to the holders of the Class A-1-b
certificates, up to an amount equal to the lesser of (a) the then
outstanding certificate balance of such class of certificates and (b)
the excess, if any, of (i) 39% of the loan group 1 principal amounts
for such distribution date over (ii) any distributions of principal
made with respect to the Class A-1-a certificates on such distribution
date in accordance with clause (2) of this paragraph;
(4) if and to the extent not otherwise paid out of the loan group 2
distribution amount and/or the other 61% of the loan group 1
distribution amount, to pay interest to the holders of the Class A-2
and Class X certificates, up to an amount equal to, and pro rata as
between such classes in accordance with, all unpaid distributable
certificate interest accrued in respect of each such Class of
certificates (or, in the case of the Class X certificates, the portion
thereof that accrued on components A-2, B, C, D, E, F, G, H, J, K, L,
M and N of such class' notional amount) through the end of the related
interest accrual period; and
(5) if the certificate balances of the Class A-1-a and Class A-1-b
certificates have been reduced to zero, to pay principal to the
holders of the Class A-2 certificates, up to an amount equal to the
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lesser of (a) the then outstanding certificate balance of such classes
of certificates (taking into account distributions of principal
thereon made out of the loan group 2 distribution amount and/or the
other 61% of the loan group 1 principal amount) and (b) the excess, if
any, of (i) 39% of the loan group 1 principal amounts for such
distribution date over (ii) any distributions of principal made with
respect to the Class A-1-a and/or Class A-1-b certificates on such
distribution date in accordance with clause (2) and/or clause (3) of
this paragraph.
Also on each distribution date prior to the earlier of the Class A
principal distribution cross-over date and the final distribution date in
connection with the termination of the trust, the trustee will (except as
described below) apply 100% of the loan group 2 distribution amount for such
date and the portion of the loan group 1 distribution amount indicated below
for such date for the following purposes and in the following order of
priority:
(1) to pay interest to the holders of the Class A-2 and Class X
certificates, pro rata as among such classes in accordance with the
amount of unpaid distributable certificate interest accrued in respect
of each such class of certificates (or, in the case of the Class X
certificates, the portion thereof that accrued on components A-2, B,
C, D, E, F, G, H, J, K, L, M and N of such class' notional amount)
through the end of the related interest accrual period up to an amount
equal to the lesser of (a) the amount of such unpaid distributable
certificate interest accrued in respect of such class and (b) the
aggregate of the loan group 2 distribution amount plus 61% of the loan
group 1 distribution amount for such distribution date;
(2) to pay principal to the holders of the Class A-2 certificates, up to
an amount equal to the lesser of (a) the then outstanding certificate
balance of such class of certificates and (b) the aggregate of 100% of
the loan group 2 principal amounts for such distribution date and 61%
of the loan group 1 principal amounts for such distribution date; and
(3) if and to the extent not otherwise paid out of the other 39% of the
loan group 1 distribution amount, to pay interest to the holders of
the Class A-1-a, Class A-1-b and Class X certificates, up to an amount
equal to, and pro rata as among such classes in accordance with, all
unpaid distributable certificate interest accrued in respect of each
such class of certificates (or, in the case of the Class X
certificates, the portion thereof that accrued on components A-1-a and
A-1-b of such class' notional amount) through the end of the related
interest accrual period.
On each distribution date on and after the date the certificate balance of
the Class A-2 certificates has been reduced to zero, the trustee will (except
as described below) apply the entire available distribution amount for such
date for the following purposes and in the following order of priority:
(1) to pay interest to the holders of the Class A-1-a, Class A-1-b and
Class X certificates, pro rata as among such classes in accordance
with the amount of unpaid distributable certificate interest accrued
in respect of such class of certificates through the end of the
related interest accrual period up to an amount equal to the amount of
such unpaid distributable certificate interest accrued in respect of
such class for such distribution date;
(2) to pay principal to the holders of the Class A-1-a certificates, up to
an amount equal to the lesser of (a) the then outstanding certificate
balance of such class of certificates and (b) the principal
distribution amount for such distribution date; and
(3) if the certificate balance of the Class A-1-a certificates has been
reduced to zero, to pay principal to the holders of the Class A-1-b
certificates, up to an amount equal to the lesser of (a) the then
outstanding certificate balance of such class of certificates and (b)
the excess, if any, of (i) the principal distribution amount for such
distribution date over (ii) any distributions of principal made with
respect to the Class A-1-a certificates on such distribution date in
accordance with clause (2) of this paragraph.
Notwithstanding the foregoing discussion under this "--Distributions of
Interest and Principal on the Senior Certificates" subsection, if for any
distribution date prior to the earlier of the Class A principal distribution
cross-over date and the final distribution date in connection with a
termination of the trust the
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application of the group 1 distribution amount and the group 2 distribution
amount for such date in the manner described above would result in a shortfall
in the payment of distributable certificate interest with respect to any class
of senior certificates, then the trustee will apply the entire available
distribution amount for such date first to pay interest to the holders of the
respective classes of senior certificates, up to an amount equal to, and pro
rata as among such classes in accordance with, all unpaid distributable
certificate interest accrued in respect of each such class of certificates
through the end of the related interest accrual period. The trustee will then
apply any remaining portion of such available distribution amount (up to the
principal distribution amount for the subject distribution date) to make
distributions of principal on the Class A-1-a, Class A-1-b and Class A-2
certificates as follows:
(1) an amount equal to the lesser of (a) 39% of the loan group 1 principal
amounts for the subject distribution date and (b) the product of (i)
such entire remaining portion of such available distribution amount,
multiplied by (ii) a fraction, the numerator of which is equal to 39%
of the loan group 1 principal amounts for the subject distribution
date, and the denominator of which is equal to the principal
distribution amount for the subject distribution date, will be applied
to make distributions of principal on the Class A-1-a certificates,
the Class A-1-b certificates and the Class A-2 certificates, in that
order, in each case until the related certificate balance is reduced
to zero; and
(2) an amount equal to the lesser of (a) 61% of the loan group 1 principal
amounts and 100% of the loan group 2 principal amounts for the subject
distribution date and (b) the product of (i) such entire remaining
portion of such available distribution amount, multiplied by (ii) a
fraction, the numerator of which is equal to 61% of the loan group 1
principal amounts and 100% of the loan group 2 principal amounts for
the subject distribution date, and the denominator of which is equal
to the principal distribution amount for the subject distribution
date, will be applied to make distributions of principal on the Class
A-2 certificates, the Class A-1-a certificates and the Class A-1-b
certificates, in that order, in each case until the related
certificate balance is reduced to zero.
On each distribution date coinciding with or following the occurrence of
any Class A principal distribution cross-over date, and in any event on the
final distribution date in connection with a termination of the trust, the
trustee will apply the entire available distribution amount for such date for
the following purposes and in the following order of priority:
(1) to pay interest to the holders of the respective classes of senior
certificates, up to an amount equal to, and pro rata as among such
classes in accordance with, all unpaid distributable certificate
interest accrued in respect of each such class of certificates through
the end of the related interest accrual period;
(2) to pay principal to the holders of the Class A-1-a, Class A-1-b and
Class A-2 certificates, up to an amount equal to, and pro rata as
among such classes in accordance with, the then outstanding class
principal balance of each such class of certificates; and
(3) if applicable, to reimburse the holders of the Class A-1-a, Class
A-1-b and Class A-2 certificates, up to an amount equal to, and pro
rata as among such classes in accordance with, the aggregate of all
unreimbursed reductions, if any, made to the certificate balance of
each such class of certificates as described under "--Subordination;
Allocation of Losses and Expenses" below in connection with realized
losses and additional trust fund expenses.
The "Class A principal distribution cross-over date" will be the first
Distribution Date as of the commencement of business on which (i) the Class
A-1-a, Class A-1-b and/or Class A-2 certificates remain outstanding and (ii)
the certificate balances of all the classes of the subordinate principal
balance certificates have previously been reduced to zero as described under
"--Subordination; Allocation of Losses and Expenses" below.
Distributions of Interest and Principal on the Subordinate Certificates
The portion, if any, of the available distribution amount for any
distribution date that remains after the distributions on the senior
certificates is referred to in this prospectus supplement as the "subordinate
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available distribution amount". The subordinate available distribution amount
for each distribution date will be applied to make payments to the holders of
each class of subordinate certificates (after all required distributions to any
subordinated class of certificates with an earlier alphabetical class
designation have been made pursuant to this clause) as follows:
o first, to pay interest, up to an amount equal to all distributable
certificate interest on that class of certificates for that
distribution date and, to the extent not previously paid, for each
prior distribution date, if any;
o second, if the certificate balances of the Class A certificates and
each class of subordinate certificates, if any, with an earlier
alphabetical class designation have been reduced to zero, to
distributions of principal, up to an amount equal to the lesser of
o the then outstanding certificate balance of that class of
certificates, and
o the remaining portion, if any, of the principal distribution
amount for that distribution date (or, on the final distribution
date resulting from the termination of the trust, up to an amount
equal to the then outstanding certificate balance of that class
of certificates); and
o third, to distributions for purposes of reimbursement, up to an amount
equal to all realized losses and additional trust expenses, if any,
previously allocated to that class of certificates and for which no
reimbursement has previously been paid; and
o the remaining portion, if any, of the available distribution amounts
to the holders of the REMIC residual certificates.
Distributable Certificate Interest
The "distributable certificate interest" for each class of REMIC regular
certificates for each distribution date is equal to the accrued certificate
interest for that class of certificates for that distribution date, reduced by
that class of certificates' allocable share (calculated as described below) of
any net aggregate prepayment interest shortfall for such distribution date.
The "accrued certificate interest" for each class of REMIC regular
certificates for each distribution date is equal to one month's interest at the
pass-through rate applicable to that class of certificates for that
distribution date accrued on the certificate balance or notional amount, as the
case may be, of that class of certificates outstanding immediately before that
distribution date. Accrued certificate interest will be calculated on the basis
of a 360-day year consisting of twelve 30-day months.
The servicer is required to make a nonreimbursable payment on each
distribution date to cover the aggregate of any prepayment interest shortfalls
and extraordinary prepayment interest shortfalls incurred on the mortgage pool
during the related collection period. However, for mortgage loans with due
dates that fall on or before the related determination date, the servicer will
cover prepayment interest shortfalls only to the extent of its aggregate master
servicing fee for the same collection period.
The "net aggregate prepayment interest shortfall" for any distribution
date will be the following amount, if any, by which:
o the aggregate of all prepayment interest shortfalls incurred on the
mortgage pool during the related collection period exceeds
o any such payment made by the servicer for that distribution date to
cover those prepayment interest shortfalls.
See "Servicing of the Mortgage Loans--Servicing and Other Compensation and
Payment of Expenses" in this prospectus supplement. The net aggregate
prepayment interest shortfall, if any, for each distribution date will be
allocated on such distribution date among each class of REMIC regular
certificates, pro rata, in accordance with the respective amounts of accrued
certificate interest for each such class of certificates for such distribution
date.
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Principal Distribution Amount
The "principal distribution amount" with respect to any distribution date
will, generally, equal the aggregate of the following (without duplication):
(1) 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, on the mortgage loans for their respective due dates
occurring during the same calendar month as that distribution date;
(2) all voluntary principal prepayments received on the mortgage loans
during the related collection period;
(3) for any balloon loan for which the stated maturity date occurred, or
any ARD loan for which the anticipated repayment date occurred, during
or before the related collection period, any payment of principal
(exclusive of any voluntary principal prepayment and any amount
described in clause (4) below) made by or on behalf of the related
borrower 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, for that
mortgage loan on a due date during or before the same calendar month
as that distribution date and not previously recovered;
(4) the portion of all liquidation proceeds, condemnation proceeds and
insurance proceeds received on the mortgage loans during the related
collection period that were identified and applied by the servicer as
recoveries of principal, in each case (exclusive of any portion of
those amounts that represents a recovery of the principal portion of
any monthly payment (other than a balloon payment) due and any excess
liquidation proceeds), or the principal portion of any assumed monthly
payment deemed due, for the related mortgage loan on a due date during
or before the same calendar month as that distribution date and not
previously recovered; and
(5) if that distribution date is after the initial distribution date, the
excess, if any, of the principal distribution amount for the
immediately preceding distribution date, over the aggregate
distributions of principal made on the principal balance certificates
from the principal distribution amount on that immediately preceding
distribution date.
An "assumed monthly payment" is an amount deemed due for:
o any balloon loan that is delinquent on its balloon payment beyond the
first determination date that follows its stated maturity date and for
which no arrangements have been agreed to for collection of the
delinquent amounts;
o the stated maturity date of any balloon loan that has a due date after
the determination date in any month; or
o any mortgage loan for which the related mortgaged property or
properties have become REO property or properties.
The assumed monthly payment deemed due on any balloon loan on its stated
maturity date and on any successive due date that it remains or is deemed to
remain outstanding will equal the monthly payment that would have been due on
such date if the related balloon payment had not come due, but rather such
mortgage loan had continued to amortize in accordance with the loan's
amortization schedule, if any, in effect immediately before maturity and had
continued to accrue interest in accordance with the loan's terms in effect
immediately before maturity. The assumed monthly payment deemed due on any
mortgage loan for which the related mortgaged property or properties have
become REO property or properties, on each due date for so long as such REO
property or properties remain part of the trust, will equal the monthly payment
(or, in the case of a balloon loan described in the prior sentence, the assumed
monthly payment) due or deemed due on the last due date before the acquisition
of that REO property or properties.
For purposes of making distributions of principal on the Class A-1-a,
Class A-1-b and Class A-2 certificates on any distribution date, the principal
distribution amount for such date will be divided into
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the loan group 1 principal amounts and the loan group 2 principal amounts. The
"loan group 1 principal amounts" for any distribution date will consist of all
amounts constituting the principal distribution amount for such date that are
attributable to the mortgage loans included in loan group 1, and the "loan
group 2 principal amounts" for any distribution date will consist of all
amounts included in the principal distribution amount for such date that are
attributable to the mortgage loans constituting loan group 2.
DISTRIBUTIONS OF PREPAYMENT PREMIUMS
On each distribution date, any prepayment premiums, or specified portions
thereof, net of any workout fees and liquidation fees payable therefrom, will
be distributed to the holders of the respective classes of principal balance
certificates senior to the Class G certificates, up to, and on a pro rata basis
in accordance with, their respective prepayment premium entitlements in
connection with such particular prepayment premiums or specified portion
thereof.
The "prepayment premium entitlement" of the holders of any class of
principal balance certificates senior to the Class G certificates with respect
to any prepayment premiums, or specified portion thereof, net of workout fees
and liquidation fees payable therefrom, will equal the following:
o For each of the Class A-1-a, Class A-1-b or Class A-2 certificates
with respect to the portion of any prepayment premiums collected in
respect of a group 1 mortgage loan that is attributable to the Class
A-1 directed principal cash flow amounts distributable on a particular
distribution date (provided that the Class A principal distribution
cross-over date has not occurred), the product of:
o 39% of such prepayment premiums (net of any portion thereof
payable as a workout fee or liquidation fee); multiplied by
o a fraction (not greater than 1.0 or less than 0.0), the numerator
of which is the excess, if any, of the pass-through rate for the
Class A-1-b certificates (or, in the case of the Class A-1-a
certificates, the pass-through rate for the Class A-1-a
certificates) over the relevant discount rate, and the
denominator of which is the excess, if any, of the mortgage rate
for such prepaid mortgage loan over the relevant discount rate;
multiplied by
o a fraction, the numerator of which is a portion of such Class A-1
directed principal cash flow amounts payable to the holders of
such class of certificates, and the denominator of which is the
entire amount of such Class A-1 directed principal cash flow
amounts.
o For each of the Class A-1-a, Class A-1-b or Class A-2 certificates
with respect to the portion of any prepayment premiums collected in
respect of any mortgage loan that is attributable to the Class A-2
directed principal cash flow amounts distributable on a particular
distribution date (provided that the Class A principal distribution
crossover date has not occurred), the product of:
o 100% (if the prepaid mortgage loan is a group 2 mortgage loan) or
61%(if the prepaid mortgage loan is a group 1 mortgage loan), as
applicable, of such prepayment premiums (net of any portion
thereof payable as a workout fee or liquidation fee); multiplied
by
o a fraction (not greater than 1.0 or less than 0.0), the numerator
of which is the excess, if any, of the pass-through rate for the
Class A-2 certificates over the relevant discount rate, and the
denominator of which is the excess, if any, of the mortgage rate
for such prepaid mortgage loan over the relevant discount rate;
multiplied by
o a fraction, the numerator of which is a portion of such Class A-2
directed principal cash flow amounts payable to the holders of
such Class of certificates, and the denominator of which is the
entire amount of such Class A-2 directed principal cash flow
amounts.
o For each of the Class A-1-a, Class A-1-b or Class A-2 certificates
with respect to any prepayment premiums collected in respect of any
mortgage loan that is attributable to any principal prepayment
distributable on a particular distribution date (provided that the
Class A principal distribution cross-over date has occurred), the
product of:
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o 100% of such prepayment premiums (net of any portion thereof
payable as a workout fee or liquidation fee); multiplied by
o a fraction (not greater than 1.0 or less than 0.0), the numerator
of which is the excess, if any, of the pass-through rate for such
class of certificates over the relevant discount rate, and the
denominator of which is the excess, if any, of the mortgage rate
for such prepaid mortgage loan over the relevant discount rate;
multiplied by
o a fraction, the numerator of which is the distribution of
principal payable to the holders of such class of certificates on
such distribution date, and the denominator of which is the
entire amount of the distribution of principal payable to the
holders of all the Class A-1-a, Class A-1-b and Class A-2
certificates on such distribution date.
o In the case of any class of subordinate principal balance certificates
senior to the Class G certificates with respect to any prepayment
premiums collected in respect of any mortgage loan that is
attributable to any principal prepayment distributable on a particular
distribution date, the product of:
o 100% of such prepayment premiums (net of any portion thereof
payable as a workout fee or liquidation fee); multiplied by
o a fraction (not greater than 1.0 or less than 0.0), the numerator
of which is the excess, if any, of the pass-through rate for such
class of certificates over the relevant discount rate, and the
denominator of which is the excess, if any, of the mortgage rate
for such prepaid mortgage loan over the relevant discount rate;
multiplied by
o a fraction, the numerator of which is the distribution of
principal payable to the holders of such class of certificates on
such distribution date, and the denominator of which is the
entire amount of the principal distribution amount for such
distribution date.
For any distribution date, the "Class A-1 directed principal cash flow
amounts" will equal 39% of the loan group 1 principal amounts.
For any distribution date, the "Class A-2 directed principal cash flow
amounts" will equal the aggregate of 61% of the loan group 1 principal amounts
and 100% of the loan group 2 principal amounts.
The portion of any prepayment premiums (net of any portion thereof payable
as a workout fee or liquidation fee) remaining after distribution of the
amounts calculated as described above to the holders of the respective classes
of principal balance certificates senior to the Class G certificates will be
distributed to the holders of the Class X certificates. After the distribution
date on which the certificate balances of all classes of principal balance
certificates senior to the Class G certificates have been reduced to zero, any
prepayment premiums collected on the mortgage loans (net of any portion thereof
payable as a workout fee or liquidation fee) will be distributable entirely to
the holders of the Class X certificates.
For any prepaid mortgage loan, the "discount rate" means the yield 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 maturity date or anticipated repayment date of
that mortgage loan as of the determination date. If there is no discount rate
for instruments having a maturity coterminous with the remaining term to
maturity or anticipated repayment date, where applicable, of the 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 remaining term to maturity or anticipated repayment date.
The prepayment premiums, if any, collected on the mortgage loans during
any collection period may not be sufficient to fully compensate
certificateholders of any class for any loss in yield attributable to the
related prepayments of principal.
DISTRIBUTIONS OF EXCESS INTEREST
No excess interest collected on an ARD loan will be available for
distribution to the holders of the offered certificates.
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DISTRIBUTIONS OF EXCESS LIQUIDATION PROCEEDS
Excess liquidation proceeds generally will not be available for
distribution to the holders of the offered certificates.
"Excess liquidation proceeds" are the excess of:
o proceeds from the sale or liquidation of a mortgage loan or REO
property, net of expenses and related advances and interest on
advances, over
o the amount that would have been received if a prepayment in full had
been made on the mortgage loan on the due date immediately following
the date upon which the proceeds were received.
TREATMENT OF REO PROPERTIES
A mortgage loan secured by mortgaged property that is acquired as part of
the trust (through foreclosure, deed in lieu of foreclosure or otherwise), will
be treated as remaining outstanding until the related REO property is
liquidated for the following purposes:
o determining distributions on the certificates,
o allocating of realized losses and additional trust expenses to the
certificates, and
o calculating the amount of servicing fees and special servicing fees
payable under the pooling and servicing agreement.
Among other things, the mortgage loan will be taken into account when
determining pass-through rates and the principal distribution amount. Operating
revenues and other proceeds from an REO property (after payment of certain
costs and taxes, including certain reimbursements payable to the servicer, any
replacement special servicer or the trustee, incurred in connection with the
operation and disposition of such REO property) will be "applied" by the
servicer as principal, interest and other amounts "due" on the mortgage loan,
and, subject to the limitations described under "--P&I Advances" below, the
servicer will be required to make P&I advances on the mortgage loan, in all
cases as if the mortgage loan had remained outstanding.
INTEREST RESERVE ACCOUNT
The trustee will establish and maintain an "interest reserve account" in
the name of the trustee for the benefit of the holders of the certificates. For
each distribution date in February and each distribution date in any January in
a year that is not a leap year, the servicer will deposit in the interest
reserve account for each mortgage loan bearing interest computed on an
actual/360 basis (the "interest reserve loans"), an amount equal to one day's
interest at the related mortgage rate (net of any servicing fee) on the
respective stated principal balance as of the immediately preceding due date,
to the extent a monthly payment or P&I advance is made on that mortgage loan.
Amounts so deposited in any January (if applicable) and February are referred
to as "withheld amounts." For each distribution date in March, the servicer
will withdraw an amount from the interest reserve account for each interest
reserve loan equal to the related withheld amounts from the preceding January
(if applicable) and February, if any, and deposit this amount into the
certificate account.
SUBORDINATION; ALLOCATION OF LOSSES AND EXPENSES
As described in this prospectus supplement, the rights of holders of
subordinate certificates to receive distributions of amounts collected or
advanced on the mortgage loans will, in the case of each class thereof, be
subordinated to the rights of holders of the senior certificates and, further,
to the rights of holders of each other class of subordinate certificates, if
any, with an earlier alphabetical class designation. This subordination is
intended to enhance the likelihood of timely receipt by holders of the
respective classes of senior certificates of the full amount of distributable
certificate interest payable on their certificates on each distribution date,
and the ultimate receipt by holders of the respective classes of Class
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A certificates of principal equal to, in each such case, the entire certificate
balance of that class of certificates. Similarly, but to decreasing degrees,
this subordination is also intended to enhance the likelihood of timely receipt
by holders of the other classes of offered certificates of the full amount of
distributable certificate interest payable on their certificates on each
distribution date, and the ultimate receipt by holders of the other classes of
offered certificates of principal equal to the entire certificate balance of
that class of certificates. The subordination of any class of subordinate
certificates will be accomplished by, among other things, the application of
the available distribution amount on each distribution date in the order of
priority described under "--Distributions--Application of the Available
Distribution Amount" above. No other form of credit support will be available
for the benefit of holders of the offered certificates.
A deficit will exist on a distribution date if the aggregate stated
principal balance of the mortgage pool outstanding immediately following such
distribution date is less than the aggregate certificate balance of the
principal balance certificates after giving effect to distributions on the
certificates on that distribution date. If a deficit exists on a distribution
date, 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 and
Class B certificates will be reduced, sequentially in that order, in the case
of each such class until the deficit (or the related certificate balance) is
reduced to zero (whichever occurs first). If any portion of the deficit remains
after the certificate balances of those classes of certificates are reduced to
zero, then the respective certificate balances of the Class A-1-a, Class A-1-b
and Class A-2 certificates will be reduced, pro rata in accordance with the
relative sizes of the remaining certificate balances of those classes of
certificates, until the deficit (or each of those certificate balances) is
reduced to zero.
A deficit may be the result of realized losses incurred on the mortgage
loans and/or additional trust expenses. These reductions in the certificate
balances of the principal balance certificates will constitute an allocation of
any realized losses and additional trust expenses. Any such reduction will also
have the effect of reducing the notional amount of the Class X certificates.
"Realized losses" are losses on the mortgage loans arising from the
inability of the servicer to collect all amounts due and owing under the
mortgage loan, including by reason of the fraud or bankruptcy of a borrower or
a casualty of any nature at a mortgaged property, to the extent not covered by
insurance.
The realized loss on a liquidated mortgage loan (or related REO property
or properties) is an amount generally equal to the excess, if any, of:
o the outstanding principal balance of the mortgage loan as of the date
of liquidation, together with all accrued and unpaid interest thereon
at the related mortgage rate to but not including the due date in the
month in which the liquidation proceeds are distributed and all
related unreimbursed servicing advances and outstanding liquidation
expenses, over
o the aggregate amount of liquidation proceeds, if any, recovered in
connection with such liquidation.
If any portion of the debt (other than excess interest) due under a
mortgage loan is forgiven, whether in connection with a modification, waiver or
amendment granted or agreed to by the servicer or in connection with the
bankruptcy or similar proceeding involving the related borrower, the amount so
forgiven also will be treated as a realized loss.
"Additional trust expenses" will reduce amounts payable to
certificateholders and, consequently, may result in a loss on the offered
certificates. Additional trust expenses include, among other things:
o special servicing fees, workout fees and liquidation fees,
o interest on unreimbursed advances,
o the cost of various opinions of counsel required or permitted to be
obtained for the servicing of the mortgage loans and the administration of
the trust,
o unanticipated, nonmortgage-loan-specific expenses of the trust, including
indemnities and reimbursements to the trustee as described under "The
Pooling and Servicing Agreements--Matters Regarding
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the Trustee" in the prospectus, indemnities and reimbursements to the
servicer and the depositor (and indemnities and reimbursements to a
replacement special servicer comparable to those for the servicer) as
described under "The Pooling and Servicing Agreements--Matters Regarding
the Master Servicer and the Depositor" in the prospectus and federal, state
and local taxes, and tax-related expenses, payable out of the trust as
described under "Servicing of the Mortgage Loans--REO Properties" in this
prospectus supplement and "Federal Income Tax
Consequences--REMICs--Taxation of Owners of REMIC Residual
Certificates--Prohibited Transactions Tax and Other Taxes" in the
prospectus,
o any amounts expended on behalf of the trust to remediate an adverse
environmental condition at any mortgaged property securing a defaulted
mortgage loan. See "The Pooling and Servicing Agreements--Realization Upon
Defaulted Mortgage Loans" in the prospectus, and
o any other expense of the trust not specifically included in the calculation
of "realized loss" for which there is no corresponding collection from a
borrower.
P&I ADVANCES
On each distribution date, the servicer will be obligated to make "P&I
advances" consisting of advances of delinquent principal and interest on the
mortgage loans, other than balloon payments out of its own funds or (subject to
the replacement thereof as provided in the pooling and servicing agreement)
funds held in the certificate account that are not required to be part of the
available distribution amount for such distribution date. The servicer will not
be required to make a P&I advance if the servicer, in its reasonable judgment,
believes that the funds therefor would not be recoverable from related proceeds
and subject to the recoverability standard described in the prospectus. P&I
advances for any distribution date will be in an amount generally equal to the
aggregate of all monthly payments (other than balloon payments or excess
interest) and any assumed monthly payments (in each case net of any related
workout fee) that were due or deemed due on the mortgage loans during the same
month as such distribution date and that were not paid by or on behalf of the
related borrowers or otherwise collected as of the close of business on the
later of such due date or the last day of the related collection period or
other specified date before such distribution date. The servicer's obligations
to make P&I advances on any mortgage loan will continue through liquidation of
that mortgage loan or disposition of any related REO property.
If it is determined that an appraisal reduction amount exists with respect
to any required appraisal mortgage loan and subsequent delinquencies occur on
the mortgage loan, the interest portion of the P&I advance for that mortgage
loan will be reduced on each distribution date for so long as the appraisal
reduction amount exists (no reduction to be made in the principal portion,
however) to equal the product of
o the amount of the interest portion of the P&I advance that would be
required to be made for that distribution date without regard to this
sentence, multiplied by
o a fraction (expressed as a percentage), the numerator of which is equal to
the stated principal balance of that mortgage loan, net of such appraisal
reduction amount, and the denominator of which is equal to the stated
principal balance of that mortgage loan.
See "Appraisal Reductions" below. If the servicer fails to make a required P&I
advance, the trustee will be required to make that P&I advance. See "The
Trustee" below.
The servicer and the trustee will each be entitled to recover any P&I
advance made by it from related proceeds collected on the mortgage loan for
which that P&I advance was made. However, neither the servicer nor the trustee
is required to make a P&I advance that would constitute a nonrecoverable
advance. If at any time, a P&I advance made by the servicer or the trustee is
determined to be a nonrecoverable advance, the servicer or the trustee will be
entitled to recover the amount of such P&I advance out of funds received on or
in respect of other mortgage loans. See "Description of the
Certificates--Advances in Respect of Delinquencies" and "The Pooling and
Servicing Agreements--Certificate Account" in the prospectus.
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Except as described in the following sentence, the servicer, the trustee
and any replacement special servicer each will be entitled to interest accrued
on the amount of any advance it makes at a "reimbursement rate" per annum equal
to the "prime rate" as published in the "Money Rates" section of The Wall
Street Journal, as that "prime rate" may change from time to time. No interest
will be paid on P&I advances made on the mortgage loan identified as loan
number 21211 on Annex A to the extent made to cover monthly payments that are
timely made under the mortgage loan documents, but made after the applicable
distribution date. Interest on any advance will be payable to the servicer, any
replacement special servicer or the trustee, as the case may be, out of default
interest collected on the related mortgage loan or, together with the
reimbursement of that advance, out of any amounts then on deposit in the
certificate account. Interest accrued on outstanding advances will result in a
reduction in amounts payable on the certificates unless the amount of default
interest collected on the related mortgage loan is sufficient to pay that
interest in full.
APPRAISAL REDUCTIONS
A mortgage loan will become a "required appraisal loan" upon the earliest
of
o the date on which the mortgage loan becomes a modified mortgage loan,
o the 90th day following the occurrence of any uncured delinquency in monthly
payments on the mortgage loan or, the 60th day following the occurence of
any uncured delinquency in any balloon payment,
o the date on which a receiver is appointed and continues in that capacity
for a mortgaged property securing the mortgage loan, and
o the date on which a mortgaged property securing the mortgage loan becomes
an REO property.
Within 30 days of a mortgage loan becoming a required appraisal loan (or
longer period if the servicer is diligently and in good faith proceeding to
obtain such appraisal), the servicer is required to obtain an appraisal of the
related mortgaged property from an independent MAI-designated appraiser. No
appraisal will be required if such an appraisal was obtained within the prior
twelve months. The cost of the appraisal will be advanced by the servicer,
subject to its right to be reimbursed therefor as a servicing advance.
As a result of this appraisal, the servicer may determine that an
appraisal reduction amount exists on the related required appraisal loan. The
"appraisal reduction amount" for any required appraisal loan will be an amount,
calculated as of the determination date immediately succeeding the date on
which the appraisal is obtained, equal to the excess, if any, of
o the sum of:
(1) the stated principal balance of such required appraisal loan,
(2) to the extent not previously advanced by or on behalf of the servicer
or the trustee, all unpaid interest on the required appraisal loan
through the most recent due date before that determination date at a
per annum rate equal to the related mortgage rate,
(3) all related unreimbursed advances made for that required appraisal
loan plus interest accrued on those advances at the reimbursement
rate, and
(4) all currently due and unpaid real estate taxes and assessments,
insurance premiums, and, if applicable, ground rents on the related
mortgaged property, net of any escrow reserves held by the servicer to
cover any of these items,
o over:
90% of the appraised value of the related mortgaged property or REO
property as determined by the appraisal, net of the amount of any
obligation secured by liens on the property that are prior to the lien of
the required appraisal loan, and are not amounts related to items included
in clause (4) above and were not taken into account in the calculation of
such appraised value.
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If an appraisal is not obtained from an independent MAI-designated
appraiser within 120 days following the earliest of the dates described in the
first sentence of this paragraph, then until the appraisal is obtained, the
appraisal reduction amount will equal 25% of the stated principal balance of
the related required appraisal loan. Upon receipt of an appraisal from an
independent MAI-designated appraiser, the appraisal reduction amount for the
required appraisal loan will be recalculated based upon the formula described
above.
Within 30 days of each anniversary of the date a loan became a required
appraisal loan, the servicer is required to order an update of the prior
appraisal. Based on the update, the servicer will redetermine and report to the
trustee the appraisal reduction amount, if any, for that mortgage loan. No
update is required for a mortgage loan that has become a corrected mortgage
loan, and for which no other special servicing event or event that would cause
the loan to be a required appraisal loan has occurred. The cost of the updates
will be covered by and reimbursable as a servicing advance.
A "modified mortgage loan" is any mortgage loan for which any special
servicing event has occurred and that has been modified by the servicer in a
manner that:
o affects the amount or timing of any payment of principal or interest
due on the mortgage loan (other than, or in addition to, bringing
current monthly payments on that mortgage loan);
o 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) of
the property to be released; or
o in the reasonable good faith judgment of the servicer, materially
impairs the security for that mortgage loan or reduces the likelihood
of timely payment of amounts due on that mortgage loan.
REPORTS TO CERTIFICATEHOLDERS; AVAILABLE INFORMATION
Trustee Reports
On each distribution date, the trustee will be required to provide or make
available to each holder of an offered certificate as of the related record
date a "distribution date statement" providing information relating to
distributions made on that date for the relevant class and the recent status of
the mortgage pool. For a discussion of the particular items of information
included in each distribution date statement, as well as a discussion of annual
information reports to be furnished by the trustee to persons who at any time
during the prior calendar year were holders of the offered certificates, see
"Description of the Certificates--Reports to Certificateholders" in the
prospectus.
In addition, based on information provided in monthly reports prepared by
the servicer and delivered to the trustee, the trustee will provide or make
available on each distribution date to each offered certificateholder the
following statements and reports (collectively with the distribution date
statements, the "trustee reports"), substantially in the forms provided in
Annex B (although the forms may be subject to change over time) and containing,
among other things, substantially the following information:
(1) A report as of the close of business on the immediately preceding
determination date, containing some categories of information
regarding the mortgage loans provided in Annex A of this prospectus
supplement in the tables under the caption "Characteristics of the
Mortgage Loans" (calculated, where applicable, on the basis of the
most recent relevant information provided by the borrowers to the
servicer and by the servicer to the trustee) and presented in a
loan-by-loan and tabular format substantially similar to the formats
utilized in Annex A.
(2) A "delinquent loan status report" containing, among other things,
those mortgage loans that, as of the close of business on the
immediately preceding determination date, were delinquent 30-59 days,
delinquent 60-89 days, delinquent 90 days or more, current but
specially serviced, or in foreclosure but not REO property or that
have become REO property.
(3) An "historical loan modification report" containing, among other
things, those mortgage loans that, as of the close of business on the
immediately preceding determination date, have been modified under the
pooling and servicing agreement
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o during the collection period ending on that determination date
and
o since the cut-off date for that mortgage loan, showing its
original and the revised terms.
(4) An "historical loss estimate report" containing, among other things,
as of the close of business on the immediately preceding determination
date,
o the aggregate amount of liquidation proceeds and liquidation
expenses, both for the collection period ending on that
determination date and for all prior collection periods, and
o the amount of realized losses occurring both during that
collection period and historically, set forth on a mortgage
loan-by-mortgage loan basis.
(5) An "REO status report" containing, among other things, for each REO
property included in the trust as of the close of business on the
immediately preceding determination date,
o the acquisition date of that REO property,
o the amount of income collected on that REO property (net of
related expenses) and other amounts, if any, received on that REO
property during the collection period ending on that
determination date, and
o the value of the REO property based on the most recent appraisal
or other valuation thereof available to the servicer as of such
date of determination (including any prepared internally by the
servicer).
(6) A "servicer watch list" containing, among other things, a list of
mortgage loans that have experienced a material decrease in debt
service coverage, a loss of or bankruptcy of the largest tenant (if
the servicer has actual knowledge of such loss or bankruptcy) or are
approaching maturity.
None of these reports will include any information that the servicer
regards as confidential. Neither the servicer nor the trustee shall be
responsible for the accuracy or completeness of any information supplied to it
by a borrower or other third party that is included in any reports, statements,
materials or information prepared or provided by the servicer or the trustee,
as applicable. Certain information will be made available to certificateholders
by electronic transmission as may be agreed upon between the depositor and the
trustee.
Before each distribution date, the servicer will deliver to the trustee by
electronic means:
o a "comparative financial status report" containing substantially the
content provided in Annex B, including, among other things, the occupancy,
revenue, net operating income and debt service coverage ratio for each
mortgage loan (other than any credit lease loans) 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):
o the most current available year-to-date;
o each of the previous two full fiscal years stated separately; and
o the "base year" (representing the original analysis of information
used as of the cut-off date for such mortgage loan); and
o a "CSSA periodic loan file" containing information on the mortgage loans
and the mortgaged properties.
In addition, the servicer is also required to perform for each mortgaged
property and REO property (other than any mortgaged property securing a credit
lease loan):
o Within 30 days after receipt of a quarterly operating statement, if any,
beginning with the calendar quarter ended December 31, 1999, an "operating
statement analysis" containing revenue, expense, and net operating income
information substantially in accordance with Annex B (but only to the
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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 the mortgaged property or REO property as of the end of that calendar
quarter. The servicer will deliver to the trustee by electronic means the
operating statement analysis upon request.
o Within 30 days after receipt by the servicer of an annual operating
statement, an NOI adjustment analysis containing substantially the content
provided in Annex B (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 the pooling and servicing agreement to "normalize" the full
year net operating income and debt service coverage numbers used by the
servicer to satisfy its reporting obligation described in clause (1) above.
The servicer will deliver to the trustee by electronic means the "NOI
adjustment worksheet" upon request.
Certificate owners who have certified to the trustee their beneficial
ownership of any offered certificate may also obtain copies of any of the
trustee reports upon request. In addition, the servicer may make available, to
certificate owners who have certified to the servicer their beneficial
ownership of any offered certificate, or prospective certificate owners who
provide appropriate confirmation that they are prospective certificate owners
who intend to keep any information confidential, copies of any reports or files
prepared by the servicer. Otherwise, until the time definitive certificates are
issued to evidence the offered certificates, the information described above
will be available to the related certificate owners only if DTC and its
participants provide the information to certificate owners. Communications by
DTC to participants, and by participants to certificate owners, will be
governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time. Except as provided in this
prospectus supplement, the servicer, the trustee, the depositor and the
certificate registrar are required to recognize as certificateholders only
those persons in whose names the certificates are registered on the books and
records of the certificate registrar.
INFORMATION AVAILABLE ELECTRONICALLY
The trustee will make available each month, to any interested party, the
distribution date statement via the trustee's internet website. In addition,
upon the approval of the depositor, the trustee will make available each month,
to any interested party, the trustee reports (other than the servicer watch
list) on the trustee's internet website. The trustee's internet website will
initially be located at "www.ctslink.com/ cmbs". In addition, the trustee will
also make mortgage loan information as presented in the CSSA loan setup file
and CSSA periodic loan update file format available each month to any
certificateholder, any certificate owner, the rating agencies, or any other
interested party via the trustee's internet website. All such reports and
statements will require the use of a password provided by the trustee to the
person requesting such report or statement upon receipt by the trustee from
such person of a certification in the form attached to the pooling and
servicing agreement. The rating agencies and the parties to the pooling and
servicing agreement will not be required to provide that certification. The
depositor may at any time instruct the trustee not to require the use of a
password to access any or all such information. In addition, the trustee will
make available, as a convenience for interested parties (and not in furtherance
of the distribution of the prospectus or the prospectus supplement under the
securities laws), the pooling and servicing agreement, the prospectus and the
prospectus supplement via the trustee's internet website. The trustee will make
no representations or warranties as to the accuracy or completeness of such
documents and will assume no responsibility for them. In addition, the trustee
may disclaim responsibility for any information distributed by the trustee for
which it is not the original source.
The trustee will make available each month the servicer watch list and the
comparative financial status report to any holder or certificate owner of an
offered certificate or any person identified to the trustee by a holder or
certificate owner as a prospective transferee of an offered certificate or any
interest therein, the rating agencies and to any of the parties to the pooling
and servicing agreement via the trustee's internet website with use of a
password provided by the trustee to that person upon receipt by
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the trustee from such person of a certification in the form attached to the
pooling and servicing agreement. The rating agencies and the parties to the
pooling and servicing agreement will not be required to provide that
certification. The depositor may at any time instruct the trustee not to
require the use of a password to access any or all such information.
In connection with providing access to the trustee's internet website, the
trustee may require registration and the acceptance of a disclaimer. The
trustee shall not be liable for the dissemination of information in accordance
with the pooling and servicing agreement.
OTHER INFORMATION
The trustee will make available at its offices, during normal business
hours, for review by any holder, certificate owner or prospective purchaser of
an offered certificate, originals or copies of the following items to the
extent they are held by the trustee:
o the pooling and servicing agreement and any amendments thereto,
o all trustee reports delivered to holders of the relevant class of offered
certificates since the delivery date,
o all officers' certificates and accountants' reports delivered to the
trustee since the delivery date as described under "The Pooling and
Servicing Agreements--Evidence as to Compliance" in the prospectus,
o the most recent property inspection report prepared by or on behalf of the
servicer and delivered to the trustee for each mortgaged property,
o the most recent annual operating statements, if any, collected by or on
behalf of the servicer and delivered to the trustee for each mortgaged
property, and
o the mortgage note, mortgage and other legal documents relating to each
mortgage loan, including any and all modifications, waivers and amendments
of the terms of a mortgage loan entered into by the servicer and delivered
to the trustee.
The trustee will provide copies of the items described above upon
reasonable written request. The trustee may require payment for the reasonable
costs and expenses of providing such copies and may also require:
o in the case of a certificate owner, a written confirmation executed by the
requesting person or entity, in a form reasonably acceptable to the
trustee, generally to the effect that the person or entity making the
request is a beneficial owner of offered certificates, is requesting the
information solely for use in evaluating its investment in the certificates
and will otherwise keep the information confidential and
o in the case of a prospective purchaser, confirmation executed by the
requesting person or entity, in a form reasonably acceptable to the
trustee, generally to the effect that the person or entity making the
request is a prospective purchaser of offered certificates or an interest
therein, is requesting the information solely for use in evaluating a
possible investment in the certificates and will otherwise keep the
information confidential.
Certificateholders, by the acceptance of their certificates, will be
deemed to have agreed to keep this information confidential. The servicer may,
but is not required to, make certain information available over the internet.
VOTING RIGHTS
At all times during the term of the pooling and servicing agreement, the
voting rights for the certificates (the "voting rights") will be allocated as
follows:
o 98% among the holders of the respective classes of principal balance
certificates in proportion to the certificate balances (adjusted as
described below) of their certificates,
o 1% among the holders of the Class X certificates, and
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o 1% allocated equally among the holders of the respective classes of REMIC
residual certificates.
Voting rights allocated to a class of certificateholders will be allocated
among those certificateholders in proportion to the percentage interests in the
class evidenced by their respective certificates. Appraisal reduction amounts
will be allocated to reduce 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-1-a, Class A-1-b and Class A-2 certificates
(pro rata among the Class A-1-a, Class A-1-b and Class A-2 certificates), in
that order, solely for purposes of calculating voting rights.
TERMINATION; RETIREMENT OF CERTIFICATES
The obligations created by the pooling and servicing agreement will
terminate following the earliest of:
o the final payment (or advance of that payment) or other liquidation of the
last mortgage loan or REO property, and
o the purchase of all of the assets of the trust by the servicer or, if the
servicer elects not to make such purchase, by the depositor, when the then
aggregate stated principal balance of the mortgage pool is less than 1% of
the initial pool balance.
Any purchase by the servicer or the depositor of all the mortgage loans
and other assets in the trust is required to be made at a price equal to:
o the aggregate purchase price of all the mortgage loans (exclusive of
mortgage loans for which the related mortgaged properties have become REO
properties) then included in the trust; plus
o the aggregate fair market value of all REO properties then included in the
trust (which fair market value for any REO property may be less than the
purchase price for the corresponding mortgage loan), as determined by an
appraiser mutually agreed upon by the servicer and the trustee; minus
o if such purchase is by the servicer, the aggregate of all amounts payable
or reimbursable to the servicer under the pooling and servicing agreement.
Written notice of termination of the pooling and servicing agreement will
be given to each certificateholder. The final distribution will be made only
upon surrender and cancellation of the certificates at the office of the
certificate registrar or other location specified in the notice of termination.
On the final distribution date, the aggregate amount paid by the servicer
or the depositor, as the case may be, for the mortgage loans and other assets
in the trust (if the trust is to be terminated as a result of the purchase of
all of the assets), together with all other amounts on deposit in the
certificate account, net of any portion of the foregoing not otherwise payable
to a person other than the certificateholders (see "The Pooling and Servicing
Agreements--Certificate Account" in the prospectus), will be applied as
described above under "--Distributions--Application of the Available
Distribution Amount."
THE TRUSTEE
The trustee is Norwest Bank Minnesota, National Association. The trustee
is at all times required to be, and will be required to resign if it fails to
be,
o a corporation or association, organized and doing business under the laws
of the United States of America or any state thereof or the District of
Columbia, authorized under those laws to exercise corporate trust powers,
having a combined capital and surplus of not less than $100,000,000 (or,
under certain conditions, such lesser amount that each rating agency has
confirmed would not cause it to qualify, downgrade or withdraw its rating
on any class of certificates) and subject to supervision or examination by
federal or state authority and
o an institution whose long-term senior unsecured debt (or that of its fiscal
agent, if applicable) is rated not less than "AA" or its equivalent by the
rating agencies (or such lower ratings as the rating agencies would permit
without causing them to qualify, downgrade or withdraw any of the
then-current ratings of the certificates).
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The corporate trust office of the trustee responsible for administration
of the trust ("corporate trust office") is located at 11000 Broken Land
Parkway, Columbia, MD 21044-3562, Attention: Corporate Trust Services
(CMBS)-GMAC Commercial Mortgage Securities, Inc., Mortgage Pass-Through
Certificates, Series 1999-C3. All requests relating to the transfer of the
Certificates should be delivered to the trustee at Norwest Center, Sixth and
Marquette, Minneapolis, Minnesota 55479-0113, Attention: Corporate Trust
Services (CMBS)-GMAC Mortgage Securities, Inc., Mortgage Pass-Through
Certificates, Series 1999-C3.
YEAR 2000 COMPLIANCE
The trustee agrees that by August 31, 1999 any custom-made software or
hardware designed, purchased or licensed by the trustee and used by the trustee
in the course of the operation or management of, or the compiling, reporting or
generation of data will not contain any deficiency
o in the ability of such software or hardware to identify correctly or
perform calculations or other processing with respect to dates after
December 31, 1999, or
o that would cause such software or hardware to be no longer fit for the
purpose for which it was intended by reason of the changing of the
year from 1999 to 2000.
YIELD AND MATURITY CONSIDERATIONS
YIELD CONSIDERATIONS
The yield to maturity of each class of certificates will depend on, among
other things:
o the purchase price of the certificates;
o the applicable pass-through rate;
o the actual characteristics of the mortgage loans; and
o the rate and timing of payments on the mortgage loans.
The Purchase Price of the Certificates
The amount by which the yield to maturity of an offered certificate may
vary from the anticipated yield will depend upon the degree to which that
certificate is purchased at a discount or premium and when, and to what degree,
payments of principal on the mortgage loans are in turn distributed on or
otherwise result in the reduction of the principal balance or notional amount,
as the case may be, of that certificate. An investor should consider, in the
case of any offered certificate purchased at a discount, the risk that a slower
than anticipated rate of principal payments on that certificate could result in
an actual yield to such investor that is lower than the anticipated yield and,
in the case of any offered certificate purchased at a premium, the risk that a
faster than anticipated rate of principal payments on that certificate could
result in an actual yield to such investor that is lower than the anticipated
yield. Generally, the earlier a payment of principal is made on an offered
certificate purchased at a discount or premium, the greater will be the effect
on an investor's yield to maturity. As a result, the effect on an investor's
yield of principal payments on that investor's offered certificates occurring
at a rate higher (or lower) than the rate anticipated by the investor during
any particular period would not be fully offset by a subsequent like reduction
(or increase) in the rate of principal payments. The yield to maturity of the
Class X certificates will be highly sensitive to the rate and timing of
principal payments (including by reason of prepayments, defaults and
liquidations) on the mortgage loans. Investors in the Class X certificates
should fully consider the associated risks, including the risk that an
extremely rapid rate of amortization and prepayment of the mortgage loans could
result in the failure of such investors to fullyrecoup their initial
investments.
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Applicable Pass-Through Rate
The pass-through rate for the Class A-1-a certificates will be fixed. The
pass-through rate for the Class X certificates for any distribution date will
be variable and will be based on the weighted average net mortgage rate for
such distribution date. The pass-through rates applicable to the Class A-1-b,
A-2, B and C certificates for any distribution date will be equal to the lesser
of a specified rate and the weighted average net mortgage rate with respect to
such distribution date. The pass-through rates applicable to the Class D, E and
F certificates for any distribution date will be equal to the weighted average
net mortgage rate with respect to such distribution date. Accordingly, the
yield on the offered certificates (other than the Class A-1-a certificates)
will be sensitive to changes in the relative composition of the mortgage loans
as a result of scheduled amortization, voluntary prepayments, liquidations of
mortgage loans following default and repurchases of mortgage loans. Losses or
payments of principal on the mortgage loans with higher net mortgage rates
could result in a reduction in the weighted average net mortgage rate, thereby
reducing the pass-through rates for the Class X, D, E and F certificates and,
to the extent that the weighted average net mortgage rate is reduced below the
specified fixed rate with respect to the Class A-1-b, A-2, B and C
certificates, reducing the pass-through rates on such classes of offered
certificates.
See "Description of the Certificates--Pass-Through Rates" and "Description
of the Mortgage Pool" in this prospectus supplement and "--Yield
Considerations--Rate and Timing of Principal Payments on the Mortgage Loans"
and "--Yield Sensitivity of the Class X Certificates" below.
Actual Characteristics of the Mortgage Loans
The yield to holders of the offered certificates will also depend on the
extent to which holders are required to bear the effects of any losses or
shortfalls on the mortgage loans. Losses and other shortfalls on the mortgage
loans will generally be borne
o first, by the holders of the respective classes of subordinate
certificates, in reverse alphabetical order of class designation, to
the extent of amounts otherwise distributable on their certificates;
and
o second, by the holders of the senior certificates.
Reductions in the balances of the principal balance certificates will also
reduce the notional amount of the Class X certificates. Any net aggregate
prepayment interest shortfall for each distribution date will be allocated on
that distribution date among each class of REMIC regular certificates, pro
rata, in accordance with the respective amounts of accrued certificate interest
for that class of certificates for that distribution date.
Rate and Timing of Payments on the Mortgage Loans
The yield to holders of the offered certificates will be affected by the
rate and timing of principal payments on the mortgage loans (including
principal prepayments on the mortgage loans resulting from both voluntary
prepayments by the mortgagors and involuntary liquidations). The rate and
timing of principal payments on the mortgage loans will in turn be affected by,
among other things, their amortization schedules, the dates on which balloon
payments are due and the rate and timing of principal prepayments and other
unscheduled collections on the mortgage loans (including for this purpose
collections resulting from liquidations of mortgage loans due to defaults,
casualties or condemnations affecting the mortgaged properties, or purchases of
mortgage loans out of the trust). Prepayments and, assuming the respective
stated maturity dates thereof have not occurred, liquidations and purchases of
the mortgage loans will result in distributions on the principal balance
certificates of amounts that otherwise would have been distributed (and
reductions in the notional amount of the Class X certificates that would
otherwise have occurred) over the remaining terms of the mortgage loans. See
"Description of the Mortgage Pool--Prepayment Provisions" and "Annex A--Earnout
Loans" and "--Additional Collateral Loans" in this prospectus supplement.
Defaults on the mortgage loans, particularly at or near their stated maturity
dates, may result in significant delays in payments of principal on the
mortgage loans (and, accordingly, on the principal balance certificates) while
work-outs are negotiated or foreclosures are
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completed. See "Servicing of the Mortgage Loans--Modifications, Waivers,
Amendments and Consents" in this prospectus supplement and "The Pooling and
Servicing Agreements--Realization Upon Defaulted Mortgage Loans" and "Legal
Aspects of Mortgage Loans--Foreclosure" in the prospectus.
The failure on the part of any borrower to pay its ARD loan on its
anticipated repayment date may result in significant delays in payments of
principal on that ARD loan and on the offered certificates. Because the rate of
principal payments on the mortgage loans will depend on future events and a
variety of factors (as described below), no assurance can be given as to such
rate or the rate of principal prepayments in particular. The depositor is not
aware of any relevant publicly available or authoritative statistics that
address the historical prepayment experience of a large group of mortgage loans
comparable to the mortgage loans.
FACTORS THAT AFFECT THE RATE AND TIMING OF PAYMENTS AND DEFAULTS
The rate and timing of principal payments and defaults and the severity of
losses on the mortgage loans may be affected by a number of factors, including
prevailing interest rates, the terms of the mortgage loans (for example,
prepayment premiums, prepayment lock-out periods and amortization terms that
require balloon payments), the demographics and relative economic vitality of
the areas in which the mortgaged properties are located and the general supply
and demand for comparable residential and/or commercial space in such areas,
the quality of management of the mortgaged properties, the servicing of the
mortgage loans, possible changes in tax laws and other opportunities for
investment. See "Risk Factors," "Description of the Mortgage Pool" and "Annex
A--Earnout Loans" and "--Additional Collateral Loans" in this prospectus
supplement and "Risk Factors" and "Yield and Maturity Considerations--Yield and
Prepayment Considerations" in the prospectus.
The rate of prepayment on the mortgage pool is likely to be affected by
prevailing market interest rates for mortgage loans of a comparable type, term
and risk level. When the prevailing market interest rate is below a mortgage
coupon, a borrower may have an increased incentive to refinance its mortgage
loan. See "Description of the Mortgage Pool--Terms and Conditions of the
Mortgage Loans" in this prospectus supplement.
DELAY IN PAYMENT OF DISTRIBUTIONS
Because monthly distributions will not be made to certificateholders until
a date that is scheduled to be at least 15 days following the end of the
related interest accrual period, the effective yield to the holders of the
offered certificates will be lower than the yield that would otherwise be
produced by the applicable pass-through rates and purchase prices (assuming
such prices did not account for such delay).
UNPAID DISTRIBUTABLE CERTIFICATE INTEREST
As described under "Description of the
Certificates--Distributions--Application of the Available Distribution Amount"
in this prospectus supplement, if the portion of the available distribution
amount distributable in respect of interest on any class of offered
certificates on any distribution date is less than the distributable
certificate interest then payable for such class, the shortfall will be
distributable to holders of such class of certificates on subsequent
distribution dates, to the extent of available funds. Any shortfall will not
bear interest, however, and will therefore negatively affect the yield to
maturity of such class of certificates for so long as it is outstanding.
WEIGHTED AVERAGE LIFE
The weighted average life of a certificate refers to the average amount of
time that will elapse from the date of its issuance until each dollar allocable
to principal or the notional amount of that certificate is distributed to the
investor or the notional amount is reduced to zero, in the case of the Class X
certificates. For purposes of this prospectus supplement, the weighted average
life of a balance certificate is determined by
o multiplying the amount of each principal distribution or reduction of the
notional amount on the certificate by the number of years from the delivery
date to the related distribution date,
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o summing the results, and
o dividing the sum by the aggregate amount of the reductions in the principal
balance or notional amount of that certificate.
The weighted average life of any certificate will be influenced by, among
other things, the rate at which principal of the mortgage loans is paid or
otherwise collected or advanced and the extent to which such payments,
collections and/or advances of principal are in turn applied in reduction of
the certificate balance or notional amount of the class of certificates to
which the certificate belongs. If the balloon payment on a balloon loan having
a due date after the determination date in any month is received on the stated
maturity date thereof, the excess of such payment over the related assumed
monthly payment will not be included in the available distribution amount until
the distribution date in the following month. As a result, the weighted average
life of the certificates may be extended.
Prepayments on mortgage loans may be measured by a prepayment standard or
model. The model used in this prospectus supplement is the "CPR" or constant
prepayment rate model. The CPR model assumes that a group of mortgage loans
experiences prepayments each month at a specified constant annual rate. As used
in each of the following sets of tables with respect to any particular class,
the column headed "0%" assumes that none of the mortgage loans is prepaid
before maturity (or the anticipated repayment date, in the case of an ARD
loan). The columns headed "25%," "50%," "75%," and "100%" assume that no
prepayments are made on any mortgage loan during that mortgage loan's
prepayment lock-out, defeasance or yield maintenance period and are otherwise
made on each of the mortgage loans at the indicated CPR percentages. There is
no assurance, however, that prepayments of the mortgage loans (whether or not
in a prepayment lock-out period, defeasance period or yield maintenance period)
will conform to any particular CPR percentages, and no representation is made
that the mortgage loans will prepay in accordance with the assumptions at any
of the CPR percentages shown or at any other particular prepayment rate, that
all the mortgage loans will prepay in accordance with the assumptions at the
same rate or that mortgage loans that are in a prepayment lock-out or
defeasance period will not prepay as a result of involuntary liquidations upon
default or otherwise.
A "prepayment lock-out period" is any period during which the terms of the
mortgage loan prohibit voluntary prepayments on the part of the borrower. A
"defeasance period" is any period during which the borrower may, under the
terms of the mortgage loan, exercise a defeasance option. A "yield maintenance
period" is any period during which the terms of the mortgage loan require the
borrower to make a yield maintenance payment together with any prepayment of
the mortgage loan.
The following tables indicate the percentage of the initial certificate
balance or initial notional amount of each class of offered certificates that
would be outstanding after each of the dates shown at the indicated CPR
percentages and the corresponding weighted average life of each of that class
of certificates. The tables have been prepared on the basis of the information
set forth on Annex A and the following maturity assumptions:
(1) the initial certificate balance or notional amount, as the case may
be, and the pass-through rate for each class of certificates are as
set forth in this prospectus supplement,
(2) the scheduled monthly payments for each mortgage loan are based on
payments of principal and interest (or of interest only, for those
mortgage loans identified on Annex A as being interest only or having
an interest only period) described on Annex A,
(3) all scheduled monthly payments (including balloon payments) are
assumed to be timely received on the first day of each month beginning
in October, 1999,
(4) there are no delinquencies or losses on the mortgage loans, there are
no extensions of maturity on the mortgage loans, there are no
appraisal reduction amounts on the mortgage loans and there are no
casualties or condemnations affecting the mortgaged properties,
(5) prepayments are made on each of the mortgage loans at the indicated
CPR percentages provided in the table (without regard to any
limitations in such mortgage loans on partial voluntary principal
prepayments) (except to the extent modified below by the assumption
numbered (13)),
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(6) the ARD loans mature on their respective anticipated repayment dates,
(7) all mortgage loans accrue interest under the method as specified in
Annex A,
(8) neither the servicer nor the depositor exercises its right of optional
termination described in this prospectus supplement,
(9) no mortgage loan is required to be repurchased by a mortgage loan
seller,
(10) no prepayment interest shortfalls are incurred and no prepayment
premiums are collected,
(11) there are no additional trust expenses,
(12) distributions on the certificates are made on the 15th day of each
month, beginning in October, 1999,
(13) no prepayments are received on any mortgage loan during that mortgage
loan's prepayment lock-out period, defeasance period or yield
maintenance period ("LOP"),
(14) the prepayment provisions for each mortgage loan are as set forth on
Annex A,
(15) no prepayments are received due to the failure to satisfy the
requirements to release earnout amounts for each earnout loan (see
"Annex A--Earnout Loans"),
(16) the delivery date is September 14, 1999, and
(17) no prepayments are received on the loan identified as loan no. TA5222
as a result of the failure of the borrower to post a letter of credit
on or before April 1, 2004 (see notes to Annex A).
To the extent that the mortgage loans have characteristics or experience
performance that differs from those assumed in preparing the tables set forth
below, the Class A-1-a, Class A-1-b, Class A-2, Class B, Class C, Class D,
Class E and Class F certificates may mature and the Class X certificates may no
longer be entitled to receive distributions on a date earlier or later than
indicated by the tables. It is highly unlikely that the mortgage loans will
prepay or perform in accordance with the maturity assumptions at any constant
rate until maturity or that all the mortgage loans will prepay in accordance
with the maturity assumptions or at the same rate. In particular, certain of
the mortgage loans may not permit voluntary partial prepayments. In addition,
variations in the actual prepayment experience and the balance of the specific
mortgage loans that prepay may increase or decrease the percentages of initial
certificate balances or notional amounts (and weighted average lives) shown in
the following tables. Such variations may occur even if the average prepayment
experience of the mortgage loans were to equal any of the specified CPR
percentages. In addition, the actual pre-tax yields on, or any other payment
characteristics of, any class of offered certificates may not correspond to any
of the information shown in the yield tables in this prospectus supplement, and
the aggregate purchase prices of the offered certificates may not be as
assumed. Investors must make their own decisions as to the appropriate
assumptions (including prepayment assumptions) to be used in deciding whether
to purchase the offered certificates.
Investors are urged to conduct their own analyses of the rates at which
the mortgage loans may be expected to prepay.
Based on the maturity assumptions, the following tables indicate the
resulting weighted average lives of the Class A-1-a, Class A-1-b, Class A-2,
Class B, Class C, Class D, Class E and Class F certificates and the percentage
of the initial certificate balance or notional amount of each such class of
certificates that would be outstanding after the closing date and each of the
distribution dates shown under the applicable assumptions at the indicated CPR
percentages.
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PERCENTAGES OF THE INITIAL CERTIFICATE BALANCE OF
THE CLASS A-1-a CERTIFICATES AT 0% CPR DURING LOCKOUT,
DEFEASANCE AND YIELD MAINTENANCE AND OTHERWISE AT INDICATED CPR
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION (CPR)
----------------------------------------------------------------------------------
DATE 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- ------------------------------------------ -------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
Closing Date ............................. 100 100 100 100 100
September 15, 2000 ....................... 95 95 95 95 95
September 15, 2001 ....................... 88 88 88 88 88
September 15, 2002 ....................... 81 81 81 81 81
September 15, 2003 ....................... 74 74 74 74 74
September 15, 2004 ....................... 66 66 66 66 66
September 15, 2005 ....................... 56 56 56 56 56
September 15, 2006 ....................... 35 35 35 35 35
September 15, 2007 ....................... 24 24 24 24 24
September 15, 2008 ....................... 0 0 0 0 0
Weighted Average Life (in years) ......... 5.781 5.773 5.762 5.746 5.699
First Principal Payment Date ............. 10/15/1999 10/15/1999 10/15/1999 10/15/1999 10/15/1999
Last Principal Payment Date .............. 5/15/2008 5/15/2008 5/15/2008 5/15/2008 2/15/2008
</TABLE>
PERCENTAGES OF THE INITIAL CERTIFICATE BALANCE OF
THE CLASS A-1-b CERTIFICATES AT 0% CPR DURING LOCKOUT,
DEFEASANCE AND YIELD MAINTENANCE AND OTHERWISE AT INDICATED CPR
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION (CPR)
-----------------------------------------------------------------------------
DATE 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- ------------------------------------------ ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Closing Date ............................. 100 100 100 100 100
September 15, 2000 ....................... 100 100 100 100 100
September 15, 2001 ....................... 100 100 100 100 100
September 15, 2002 ....................... 100 100 100 100 100
September 15, 2003 ....................... 100 100 100 100 100
September 15, 2004 ....................... 100 100 100 100 100
September 15, 2005 ....................... 100 100 100 100 100
September 15, 2006 ....................... 100 100 100 100 100
September 15, 2007 ....................... 100 100 100 100 100
September 15, 2008 ....................... 90 90 90 89 87
September 15, 2009 ....................... 0 0 0 0 0
Weighted Average Life (in years) ......... 9.648 9.630 9.608 9.575 9.373
First Principal Payment Date ............. 5/15/2008 5/15/2008 5/15/2008 5/15/2008 2/15/2008
Last Principal Payment Date .............. 8/15/2009 7/15/2009 7/15/2009 7/15/2009 5/15/2009
</TABLE>
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PERCENTAGES OF THE INITIAL CERTIFICATE BALANCE OF
THE CLASS A-2 CERTIFICATES AT 0% CPR DURING LOCKOUT,
DEFEASANCE AND YIELD MAINTENANCE AND OTHERWISE AT INDICATED CPR
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION (CPR)
----------------------------------------------------------------------------------
DATE 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- ------------------------------------------ -------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
Closing Date ............................. 100 100 100 100 100
September 15, 2000 ....................... 99 99 99 99 99
September 15, 2001 ....................... 98 98 98 98 98
September 15, 2002 ....................... 96 96 96 96 96
September 15, 2003 ....................... 95 95 95 95 95
September 15, 2004 ....................... 93 93 93 93 93
September 15, 2005 ....................... 91 91 91 91 91
September 15, 2006 ....................... 88 88 88 88 88
September 15, 2007 ....................... 86 85 85 84 80
September 15, 2008 ....................... 70 70 69 69 68
September 15, 2009 ....................... 0 0 0 0 0
Weighted Average Life (in years) ......... 8.839 8.822 8.801 8.774 8.603
First Principal Payment Date ............. 10/15/1999 10/15/1999 10/15/1999 10/15/1999 10/15/1999
Last Principal Payment Date .............. 8/15/2009 8/15/2009 7/15/2009 7/15/2009 5/15/2009
</TABLE>
PERCENTAGES OF THE INITIAL CERTIFICATE BALANCE OF
THE CLASS B CERTIFICATES AT 0% CPR DURING LOCKOUT,
DEFEASANCE AND YIELD MAINTENANCE AND OTHERWISE AT INDICATED CPR
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION (CPR)
-----------------------------------------------------------------------------
DATE 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- ------------------------------------------ ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Closing Date ............................. 100 100 100 100 100
September 15, 2000 ....................... 100 100 100 100 100
September 15, 2001 ....................... 100 100 100 100 100
September 15, 2002 ....................... 100 100 100 100 100
September 15, 2003 ....................... 100 100 100 100 100
September 15, 2004 ....................... 100 100 100 100 100
September 15, 2005 ....................... 100 100 100 100 100
September 15, 2006 ....................... 100 100 100 100 100
September 15, 2007 ....................... 100 100 100 100 100
September 15, 2008 ....................... 100 100 100 100 100
September 15, 2009 ....................... 0 0 0 0 0
Weighted Average Life (in years) ......... 9.919 9.919 9.905 9.843 9.669
First Principal Payment Date ............. 8/15/2009 8/15/2009 7/15/2009 7/15/2009 5/15/2009
Last Principal Payment Date .............. 8/15/2009 8/15/2009 8/15/2009 8/15/2009 5/15/2009
</TABLE>
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<PAGE>
PERCENTAGES OF THE INITIAL CERTIFICATE BALANCE OF
THE CLASS C CERTIFICATES AT 0% CPR DURING LOCKOUT,
DEFEASANCE AND YIELD MAINTENANCE AND OTHERWISE AT INDICATED CPR
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION (CPR)
-----------------------------------------------------------------------------
DATE 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- ------------------------------------------ ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Closing Date ............................. 100 100 100 100 100
September 15, 2000 ....................... 100 100 100 100 100
September 15, 2001 ....................... 100 100 100 100 100
September 15, 2002 ....................... 100 100 100 100 100
September 15, 2003 ....................... 100 100 100 100 100
September 15, 2004 ....................... 100 100 100 100 100
September 15, 2005 ....................... 100 100 100 100 100
September 15, 2006 ....................... 100 100 100 100 100
September 15, 2007 ....................... 100 100 100 100 100
September 15, 2008 ....................... 100 100 100 100 100
September 15, 2009 ....................... 0 0 0 0 0
Weighted Average Life (in years) ......... 9.919 9.919 9.919 9.919 9.669
First Principal Payment Date ............. 8/15/2009 8/15/2009 8/15/2009 8/15/2009 5/15/2009
Last Principal Payment Date .............. 8/15/2009 8/15/2009 8/15/2009 8/15/2009 5/15/2009
</TABLE>
PERCENTAGES OF THE INITIAL CERTIFICATE BALANCE OF
THE CLASS D CERTIFICATES AT 0% CPR DURING LOCKOUT,
DEFEASANCE AND YIELD MAINTENANCE AND OTHERWISE AT INDICATED CPR
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION (CPR)
-----------------------------------------------------------------------------
DATE 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- ------------------------------------------ ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Closing Date ............................. 100 100 100 100 100
September 15, 2000 ....................... 100 100 100 100 100
September 15, 2001 ....................... 100 100 100 100 100
September 15, 2002 ....................... 100 100 100 100 100
September 15, 2003 ....................... 100 100 100 100 100
September 15, 2004 ....................... 100 100 100 100 100
September 15, 2005 ....................... 100 100 100 100 100
September 15, 2006 ....................... 100 100 100 100 100
September 15, 2007 ....................... 100 100 100 100 100
September 15, 2008 ....................... 100 100 100 100 100
September 15, 2009 ....................... 0 0 0 0 0
Weighted Average Life (in years) ......... 9.919 9.919 9.919 9.919 9.669
First Principal Payment Date ............. 8/15/2009 8/15/2009 8/15/2009 8/15/2009 5/15/2009
Last Principal Payment Date .............. 8/15/2009 8/15/2009 8/15/2009 8/15/2009 5/15/2009
</TABLE>
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<PAGE>
PERCENTAGES OF THE INITIAL CERTIFICATE BALANCE OF
THE CLASS E CERTIFICATES AT 0% CPR DURING LOCKOUT,
DEFEASANCE AND YIELD MAINTENANCE AND OTHERWISE AT INDICATED CPR
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION (CPR)
-----------------------------------------------------------------------------
DATE 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- ------------------------------------------ ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Closing Date ............................. 100 100 100 100 100
September 15, 2000 ....................... 100 100 100 100 100
September 15, 2001 ....................... 100 100 100 100 100
September 15, 2002 ....................... 100 100 100 100 100
September 15, 2003 ....................... 100 100 100 100 100
September 15, 2004 ....................... 100 100 100 100 100
September 15, 2005 ....................... 100 100 100 100 100
September 15, 2006 ....................... 100 100 100 100 100
September 15, 2007 ....................... 100 100 100 100 100
September 15, 2008 ....................... 100 100 100 100 100
September 15, 2009 ....................... 0 0 0 0 0
Weighted Average Life (in years) ......... 9.919 9.919 9.919 9.919 9.672
First Principal Payment Date ............. 8/15/2009 8/15/2009 8/15/2009 8/15/2009 5/15/2009
Last Principal Payment Date .............. 8/15/2009 8/15/2009 8/15/2009 8/15/2009 6/15/2009
</TABLE>
PERCENTAGES OF THE INITIAL CERTIFICATE BALANCE OF
THE CLASS F CERTIFICATES AT 0% CPR DURING LOCKOUT,
DEFEASANCE AND YIELD MAINTENANCE AND OTHERWISE AT INDICATED CPR
<TABLE>
<CAPTION>
PREPAYMENT ASSUMPTION (CPR)
-----------------------------------------------------------------------------
DATE 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- ------------------------------------------ ------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Closing Date ............................. 100 100 100 100 100
September 15, 2000 ....................... 100 100 100 100 100
September 15, 2001 ....................... 100 100 100 100 100
September 15, 2002 ....................... 100 100 100 100 100
September 15, 2003 ....................... 100 100 100 100 100
September 15, 2004 ....................... 100 100 100 100 100
September 15, 2005 ....................... 100 100 100 100 100
September 15, 2006 ....................... 100 100 100 100 100
September 15, 2007 ....................... 100 100 100 100 100
September 15, 2008 ....................... 100 100 100 100 100
September 15, 2009 ....................... 0 0 0 0 0
Weighted Average Life (in years) ......... 9.919 9.919 9.919 9.919 9.753
First Principal Payment Date ............. 8/15/2009 8/15/2009 8/15/2009 8/15/2009 6/15/2009
Last Principal Payment Date .............. 8/15/2009 8/15/2009 8/15/2009 8/15/2009 6/15/2009
</TABLE>
PRICE/YIELD TABLES
The tables set forth below show the corporate bond equivalent ("CBE")
yield and weighted average life in years for each class of offered certificates
(other than the Class X certificates) under the maturity assumptions.
The yields provided in the following tables were calculated by determining
the monthly discount rates which, when applied to the assumed stream of cash
flows to be paid on each class of offered certificates (other than the Class X
certificates), would cause the discounted present value of such assumed stream
of cash flows as of September 14, 1999 to equal the assumed purchase prices,
plus accrued interest at the applicable pass-through rate as stated on the
cover hereof from and including September 1, 1999 to but excluding the delivery
date, and converting such monthly rates to semi-annual corporate bond
equivalent rates. Such calculation does not take into account variations that
may occur in
S-90
<PAGE>
the interest rates at which investors may be able to reinvest funds received by
them as reductions of the certificate balances of classes of offered
certificates and consequently does not purport to reflect the return on any
investment in those classes of offered certificates when reinvestment rates are
considered. Purchase prices are expressed in 32nds and interpreted as a
percentage of the initial certificate balance of the specified class (i.e.,
99-16 means 99 16/32%) and are exclusive of accrued interest. A "+" means an
additional 1/2 of 1/32%.
PRE-TAX YIELD TO MATURITY (CBE), WEIGHTED AVERAGE LIFE,
FIRST PRINCIPAL PAYMENT DATE AND LAST PRINCIPAL PAYMENT DATE
FOR THE CLASS A-1-a CERTIFICATES AT THE SPECIFIED CPRS
<TABLE>
<CAPTION>
0% CPR DURING LOCKOUT, DEFEASANCE AND YIELD MAINTENANCE
OTHERWISE AT INDICATED CPR
-----------------------------------------------------------
ASSUMED PRICE (32NDS) 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- -------------------------------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
98-00 ................................ 7.468% 7.469% 7.469% 7.470% 7.472%
98-08 ................................ 7.411% 7.411% 7.412% 7.412% 7.414%
98-16 ................................ 7.354% 7.354% 7.355% 7.355% 7.357%
98-24 ................................ 7.297% 7.297% 7.297% 7.298% 7.299%
99-00 ................................ 7.240% 7.240% 7.241% 7.241% 7.242%
99-08 ................................ 7.184% 7.184% 7.184% 7.184% 7.185%
99-16 ................................ 7.127% 7.128% 7.128% 7.128% 7.128%
99-24 ................................ 7.071% 7.071% 7.071% 7.071% 7.071%
100-00 ............................... 7.015% 7.015% 7.015% 7.015% 7.015%
100-08 ............................... 6.960% 6.960% 6.960% 6.959% 6.959%
100-16 ............................... 6.904% 6.904% 6.904% 6.904% 6.903%
100-24 ............................... 6.849% 6.849% 6.848% 6.848% 6.847%
101-00 ............................... 6.794% 6.794% 6.793% 6.793% 6.791%
101-08 ............................... 6.739% 6.739% 6.738% 6.738% 6.736%
101-16 ............................... 6.684% 6.684% 6.683% 6.683% 6.680%
101-24 ............................... 6.630% 6.629% 6.629% 6.628% 6.625%
102-00 ............................... 6.575% 6.575% 6.574% 6.573% 6.570%
Weighted Average Life (yrs.) ......... 5.781 5.773 5.762 5.746 5.699
First Principal Payment Date ......... Oct-1999 Oct-1999 Oct-1999 Oct-1999 Oct-1999
Last Principal Payment Date .......... May-2008 May-2008 May-2008 May-2008 Feb-2008
</TABLE>
PRE-TAX YIELD TO MATURITY (CBE), WEIGHTED AVERAGE LIFE,
FIRST PRINCIPAL PAYMENT DATE AND LAST PRINCIPAL PAYMENT DATE
FOR THE CLASS A-1-b CERTIFICATES AT THE SPECIFIED CPRS
<TABLE>
<CAPTION>
0% CPR DURING LOCKOUT, DEFEASANCE AND YIELD MAINTENANCE
OTHERWISE AT INDICATED CPR
-----------------------------------------------------------
ASSUMED PRICE (32NDS) 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- -------------------------------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
98-00 ................................ 7.643% 7.643% 7.644% 7.644% 7.648%
98-08 ................................ 7.605% 7.605% 7.605% 7.606% 7.609%
98-16 ................................ 7.567% 7.567% 7.567% 7.568% 7.571%
98-24 ................................ 7.529% 7.529% 7.530% 7.530% 7.532%
99-00 ................................ 7.491% 7.492% 7.492% 7.492% 7.494%
99-08 ................................ 7.454% 7.454% 7.454% 7.454% 7.455%
99-16 ................................ 7.417% 7.417% 7.417% 7.417% 7.417%
99-24 ................................ 7.379% 7.379% 7.379% 7.379% 7.379%
100-00 ............................... 7.342% 7.342% 7.342% 7.342% 7.341%
100-08 ............................... 7.305% 7.305% 7.305% 7.305% 7.303%
100-16 ............................... 7.268% 7.268% 7.268% 7.267% 7.266%
100-24 ............................... 7.231% 7.231% 7.231% 7.230% 7.228%
101-00 ............................... 7.195% 7.194% 7.194% 7.194% 7.191%
101-08 ............................... 7.158% 7.158% 7.157% 7.157% 7.153%
101-16 ............................... 7.121% 7.121% 7.121% 7.120% 7.116%
101-24 ............................... 7.085% 7.085% 7.084% 7.084% 7.079%
102-00 ............................... 7.049% 7.048% 7.048% 7.047% 7.042%
Weighted Average Life (yrs.) ......... 9.648 9.630 9.608 9.575 9.373
First Principal Payment Date ......... May-2008 May-2008 May-2008 May-2008 Feb-2008
Last Principal Payment Date .......... Aug-2009 Jul-2009 Jul-2009 Jul-2009 May-2009
</TABLE>
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<PAGE>
PRE-TAX YIELD TO MATURITY (CBE), WEIGHTED AVERAGE LIFE,
FIRST PRINCIPAL PAYMENT DATE AND LAST PRINCIPAL PAYMENT DATE
FOR THE CLASS A-2 CERTIFICATES AT THE SPECIFIED CPRS
<TABLE>
<CAPTION>
0% CPR DURING LOCKOUT, DEFEASANCE AND YIELD MAINTENANCE
OTHERWISE AT INDICATED CPR
-----------------------------------------------------------
ASSUMED PRICE (32NDS) 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- -------------------------------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
98-16 ................................ 7.484% 7.484% 7.484% 7.485% 7.488%
98-24 ................................ 7.443% 7.444% 7.444% 7.444% 7.446%
99-00 ................................ 7.403% 7.403% 7.403% 7.404% 7.405%
99-08 ................................ 7.363% 7.363% 7.363% 7.363% 7.364%
99-16 ................................ 7.323% 7.323% 7.323% 7.323% 7.323%
99-24 ................................ 7.283% 7.283% 7.283% 7.283% 7.282%
100-00 ............................... 7.243% 7.243% 7.243% 7.242% 7.242%
100-08 ............................... 7.203% 7.203% 7.203% 7.203% 7.201%
100-16 ............................... 7.163% 7.163% 7.163% 7.163% 7.161%
100-24 ............................... 7.124% 7.124% 7.123% 7.123% 7.121%
101-00 ............................... 7.085% 7.084% 7.084% 7.084% 7.081%
101-08 ............................... 7.045% 7.045% 7.045% 7.044% 7.041%
101-16 ............................... 7.006% 7.006% 7.006% 7.005% 7.001%
101-24 ............................... 6.967% 6.967% 6.966% 6.966% 6.961%
102-00 ............................... 6.929% 6.928% 6.928% 6.927% 6.922%
102-08 ............................... 6.890% 6.889% 6.889% 6.888% 6.882%
102-16 ............................... 6.851% 6.851% 6.850% 6.849% 6.843%
Weighted Average Life (yrs.) ......... 8.839 8.822 8.801 8.774 8.603
First Principal Payment Date ......... Oct-1999 Oct-1999 Oct-1999 Oct-1999 Oct-1999
Last Principal Payment Date .......... Aug-2009 Aug-2009 Jul-2009 Jul-2009 May-2009
</TABLE>
PRE-TAX YIELD TO MATURITY (CBE), WEIGHTED AVERAGE LIFE,
FIRST PRINCIPAL PAYMENT DATE AND LAST PRINCIPAL PAYMENT DATE
FOR THE CLASS B CERTIFICATES AT THE SPECIFIED CPRS
<TABLE>
<CAPTION>
0% CPR DURING LOCKOUT, DEFEASANCE AND YIELD MAINTENANCE
OTHERWISE AT INDICATED CPR
-----------------------------------------------------------
ASSUMED PRICE (32NDS) 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- -------------------------------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
98-00 ................................ 7.915% 7.915% 7.915% 7.916% 7.919%
98-08 ................................ 7.877% 7.877% 7.877% 7.878% 7.881%
98-16 ................................ 7.840% 7.840% 7.840% 7.840% 7.843%
98-24 ................................ 7.802% 7.802% 7.802% 7.803% 7.804%
99-00 ................................ 7.765% 7.765% 7.765% 7.765% 7.766%
99-08 ................................ 7.727% 7.727% 7.727% 7.728% 7.728%
99-16 ................................ 7.690% 7.690% 7.690% 7.690% 7.691%
99-24 ................................ 7.653% 7.653% 7.653% 7.653% 7.653%
100-00 ............................... 7.616% 7.616% 7.616% 7.616% 7.615%
100-08 ............................... 7.579% 7.579% 7.579% 7.579% 7.578%
100-16 ............................... 7.543% 7.543% 7.543% 7.542% 7.541%
100-24 ............................... 7.506% 7.506% 7.506% 7.505% 7.503%
101-00 ............................... 7.470% 7.470% 7.469% 7.469% 7.466%
101-08 ............................... 7.433% 7.433% 7.433% 7.432% 7.429%
101-16 ............................... 7.397% 7.397% 7.397% 7.396% 7.392%
101-24 ............................... 7.361% 7.361% 7.361% 7.359% 7.356%
102-00 ............................... 7.325% 7.325% 7.325% 7.323% 7.319%
Weighted Average Life (yrs.) ......... 9.919 9.919 9.905 9.843 9.669
First Principal Payment Date ......... Aug-2009 Aug-2009 Jul-2009 Jul-2009 May-2009
Last Principal Payment Date .......... Aug-2009 Aug-2009 Aug-2009 Aug-2009 May-2009
</TABLE>
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<PAGE>
PRE-TAX YIELD TO MATURITY (CBE), WEIGHTED AVERAGE LIFE,
FIRST PRINCIPAL PAYMENT DATE AND LAST PRINCIPAL PAYMENT DATE
FOR THE CLASS C CERTIFICATES AT THE SPECIFIED CPRS
<TABLE>
<CAPTION>
0% CPR DURING LOCKOUT, DEFEASANCE AND YIELD MAINTENANCE
OTHERWISE AT INDICATED CPR
-----------------------------------------------------------
ASSUMED PRICE (32NDS) 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- -------------------------------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
97-26 ................................ 8.199% 8.199% 8.199% 8.199% 8.204%
98-02 ................................ 8.160% 8.160% 8.160% 8.160% 8.165%
98-10 ................................ 8.122% 8.122% 8.122% 8.122% 8.126%
98-18 ................................ 8.084% 8.084% 8.084% 8.084% 8.087%
98-26 ................................ 8.046% 8.046% 8.046% 8.046% 8.049%
99-02 ................................ 8.008% 8.008% 8.008% 8.008% 8.010%
99-10 ................................ 7.971% 7.971% 7.971% 7.971% 7.972%
99-18 ................................ 7.933% 7.933% 7.933% 7.933% 7.934%
99-26 ................................ 7.896% 7.896% 7.896% 7.896% 7.895%
100-02 ............................... 7.858% 7.858% 7.858% 7.858% 7.857%
100-10 ............................... 7.821% 7.821% 7.821% 7.821% 7.820%
100-18 ............................... 7.784% 7.784% 7.784% 7.784% 7.782%
100-26 ............................... 7.747% 7.747% 7.747% 7.747% 7.744%
101-02 ............................... 7.710% 7.710% 7.710% 7.710% 7.707%
101-10 ............................... 7.673% 7.673% 7.674% 7.674% 7.669%
101-18 ............................... 7.637% 7.637% 7.637% 7.637% 7.632%
101-26 ............................... 7.600% 7.600% 7.600% 7.600% 7.595%
Weighted Average Life (yrs.) ......... 9.919 9.919 9.919 9.919 9.669
First Principal Payment Date ......... Aug-2009 Aug-2009 Aug-2009 Aug-2009 May-2009
Last Principal Payment Date .......... Aug-2009 Aug-2009 Aug-2009 Aug-2009 May-2009
</TABLE>
PRE-TAX YIELD TO MATURITY (CBE), WEIGHTED AVERAGE LIFE,
FIRST PRINCIPAL PAYMENT DATE AND LAST PRINCIPAL PAYMENT DATE
FOR THE CLASS D CERTIFICATES AT THE SPECIFIED CPRS
<TABLE>
<CAPTION>
0% CPR DURING LOCKOUT, DEFEASANCE AND YIELD MAINTENANCE
OTHERWISE AT INDICATED CPR
-----------------------------------------------------------
ASSUMED PRICE (32NDS) 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- -------------------------------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
97-29+ ............................... 8.300% 8.300% 8.300% 8.301% 8.306%
98-05+ ............................... 8.261% 8.262% 8.262% 8.263% 8.267%
98-13+ ............................... 8.223% 8.223% 8.224% 8.224% 8.228%
98-21+ ............................... 8.185% 8.185% 8.185% 8.186% 8.189%
98-29+ ............................... 8.147% 8.147% 8.147% 8.148% 8.150%
99-05+ ............................... 8.109% 8.109% 8.109% 8.110% 8.111%
99-13+ ............................... 8.071% 8.071% 8.072% 8.072% 8.073%
99-21+ ............................... 8.033% 8.033% 8.034% 8.035% 8.035%
99-29+ ............................... 7.995% 7.996% 7.996% 7.997% 7.996%
100-05+ .............................. 7.958% 7.958% 7.959% 7.960% 7.958%
100-13+ .............................. 7.921% 7.921% 7.921% 7.922% 7.920%
100-21+ .............................. 7.883% 7.884% 7.884% 7.885% 7.882%
100-29+ .............................. 7.846% 7.847% 7.847% 7.848% 7.845%
101-05+ .............................. 7.809% 7.810% 7.810% 7.811% 7.807%
101-13+ .............................. 7.773% 7.773% 7.773% 7.774% 7.770%
101-21+ .............................. 7.736% 7.736% 7.737% 7.737% 7.732%
101-29+ .............................. 7.699% 7.700% 7.700% 7.701% 7.695%
Weighted Average Life (yrs.) ......... 9.919 9.919 9.919 9.919 9.669
First Principal Payment Date ......... Aug-2009 Aug-2009 Aug-2009 Aug-2009 May-2009
Last Principal Payment Date .......... Aug-2009 Aug-2009 Aug-2009 Aug-2009 May-2009
</TABLE>
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<PAGE>
PRE-TAX YIELD TO MATURITY (CBE), WEIGHTED AVERAGE LIFE,
FIRST PRINCIPAL PAYMENT DATE AND LAST PRINCIPAL PAYMENT DATE
FOR THE CLASS E CERTIFICATES AT THE SPECIFIED CPRS
<TABLE>
<CAPTION>
0% CPR DURING LOCKOUT, DEFEASANCE AND YIELD MAINTENANCE
OTHERWISE AT INDICATED CPR
-----------------------------------------------------------
ASSUMED PRICE (32NDS) 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- -------------------------------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
95-20 ................................ 8.659% 8.660% 8.660% 8.661% 8.671%
95-28 ................................ 8.620% 8.620% 8.620% 8.621% 8.631%
96-04 ................................ 8.580% 8.580% 8.581% 8.582% 8.591%
96-12 ................................ 8.541% 8.541% 8.541% 8.542% 8.551%
96-20 ................................ 8.501% 8.502% 8.502% 8.503% 8.511%
96-28 ................................ 8.462% 8.463% 8.463% 8.464% 8.471%
97-04 ................................ 8.423% 8.423% 8.424% 8.425% 8.431%
97-12 ................................ 8.384% 8.385% 8.385% 8.386% 8.392%
97-20 ................................ 8.345% 8.346% 8.346% 8.347% 8.352%
97-28 ................................ 8.307% 8.307% 8.308% 8.308% 8.313%
98-04 ................................ 8.268% 8.269% 8.269% 8.270% 8.274%
98-12 ................................ 8.230% 8.230% 8.231% 8.232% 8.235%
98-20 ................................ 8.192% 8.192% 8.193% 8.193% 8.196%
98-28 ................................ 8.154% 8.154% 8.154% 8.155% 8.157%
99-04 ................................ 8.116% 8.116% 8.117% 8.117% 8.119%
99-12 ................................ 8.078% 8.078% 8.079% 8.079% 8.080%
99-20 ................................ 8.040% 8.040% 8.041% 8.042% 8.042%
Weighted Average Life (yrs.) ......... 9.919 9.919 9.919 9.919 9.672
First Principal Payment Date ......... Aug-2009 Aug-2009 Aug-2009 Aug-2009 May-2009
Last Principal Payment Date .......... Aug-2009 Aug-2009 Aug-2009 Aug-2009 Jun-2009
</TABLE>
PRE-TAX YIELD TO MATURITY (CBE), WEIGHTED AVERAGE LIFE,
FIRST PRINCIPAL PAYMENT DATE AND LAST PRINCIPAL PAYMENT DATE
FOR THE CLASS F CERTIFICATES AT THE SPECIFIED CPRS
<TABLE>
<CAPTION>
0% CPR DURING LOCKOUT, DEFEASANCE AND YIELD MAINTENANCE
OTHERWISE AT INDICATED CPR
-----------------------------------------------------------
ASSUMED PRICE (32NDS) 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- -------------------------------------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
91-07+ ............................... 9.380% 9.380% 9.381% 9.381% 9.399%
91-15+ ............................... 9.338% 9.338% 9.338% 9.339% 9.356%
91-23+ ............................... 9.295% 9.296% 9.296% 9.297% 9.314%
91-31+ ............................... 9.254% 9.254% 9.254% 9.255% 9.271%
92-07+ ............................... 9.212% 9.212% 9.213% 9.213% 9.229%
92-15+ ............................... 9.170% 9.170% 9.171% 9.172% 9.187%
92-23+ ............................... 9.129% 9.129% 9.129% 9.130% 9.145%
92-31+ ............................... 9.087% 9.088% 9.088% 9.089% 9.103%
93-07+ ............................... 9.046% 9.046% 9.047% 9.048% 9.061%
93-15+ ............................... 9.005% 9.005% 9.006% 9.006% 9.020%
93-23+ ............................... 8.964% 8.964% 8.965% 8.966% 8.979%
93-31+ ............................... 8.923% 8.924% 8.924% 8.925% 8.937%
94-07+ ............................... 8.883% 8.883% 8.883% 8.884% 8.896%
94-15+ ............................... 8.842% 8.843% 8.843% 8.844% 8.855%
94-23+ ............................... 8.802% 8.802% 8.803% 8.803% 8.815%
94-31+ ............................... 8.762% 8.762% 8.762% 8.763% 8.774%
95-07+ ............................... 8.722% 8.722% 8.722% 8.723% 8.733%
Weighted Average Life (yrs.) ......... 9.919 9.919 9.919 9.919 9.753
First Principal Payment Date ......... Aug-2009 Aug-2009 Aug-2009 Aug-2009 Jun-2009
Last Principal Payment Date .......... Aug-2009 Aug-2009 Aug-2009 Aug-2009 Jun-2009
</TABLE>
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<PAGE>
YIELD SENSITIVITY OF THE CLASS X CERTIFICATES
The yield to maturity of the Class X certificates will be especially
sensitive to the prepayment, repurchase and default experience on the mortgage
loans, which prepayment, repurchase and default experience may fluctuate
significantly from time to time. A rapid rate of principal payments will have a
material negative effect on the yield to maturity of the Class X certificates.
The mortgage loans may prepay at a different rate. In addition, the
pass-through rate for any Class X component relating to a class of principal
balance certificates having a pass-through rate equal to the weighted average
net mortgage rate will be zero. Prospective investors in the Class X
certificates should fully consider the associated risks, including the risk
that such investors may not fully recover their initial investment.
The following table indicates the sensitivity of the pre-tax yield to
maturity on the Class X certificates to various CPR percentages on the mortgage
loans by projecting the monthly aggregate payments of interest on the Class X
certificates and computing the corresponding pre-tax yields to maturity on a
corporate bond equivalent basis, based on the maturity assumptions. It was
further assumed that the aggregate purchase price of the Class X certificates
are as specified below, in each case expressed in 32nds and interpreted as a
percentage (i.e., 4-16 is 4 16/32%) of the initial notional amount (without
accrued interest). Any differences between these assumptions and the actual
characteristics and performance of the mortgage loans and of the Class X
certificates may result in yields being different from those shown in such
table. Discrepancies between assumed and actual characteristics and performance
underscore the hypothetical nature of the table, which is provided only to give
a general sense of the sensitivity of yields in varying prepayment scenarios.
The pre-tax yields provided in the following table were calculated by
determining the monthly discount rates that, when applied to the assumed
streams of cash flows to be paid on the Class X certificates, would cause the
discounted present value of such assumed stream of cash flows as of September
14, 1999 to equal the assumed aggregate purchase price plus accrued interest at
the initial pass-through rate for the Class X certificates from and including
September 1, 1999 to but excluding the delivery date, and by converting these
monthly rates to semi-annual corporate bond equivalent rates. The calculation
does not take into account shortfalls in the collection of interest due to
prepayments (or other liquidations) of the mortgage loans or the interest rates
at which investors may be able to reinvest funds received by them as
distributions on the Class X certificates (and accordingly does not purport to
reflect the return on any investment in the Class X certificates when such
reinvestment rates are considered).
It is highly unlikely that the mortgage loans will be prepaid according to
one particular pattern. For this reason, and because the timing of cash flows
is critical to determining yields, the pre-tax yield to maturity on the Class X
certificates is likely to differ from those shown in the following table, even
if all of the mortgage loans prepay at the indicated CPR percentages over any
given time period or over the entire life of the certificates.
The mortgage loans may not prepay in accordance with the maturity
assumptions at any particular rate, and the yield on the Class X certificates
may not conform to the yields described in this prospectus supplement.
Investors are urged to make their investment decisions based on the
determinations as to anticipated rates of prepayment under a variety of
scenarios. Investors in the Class X certificates should fully consider the risk
that a rapid rate of prepayments on the mortgage loans could result in the
failure of such investors to fully recover their investments.
In addition, holders of the Class X certificates generally have rights to
relatively larger portions of interest payments on mortgage loans with higher
mortgage rates. As a result, the yield on the Class X certificates will be
materially and adversely affected if the mortgage loans with higher mortgage
rates prepay faster than the mortgage loans with lower mortgage rates.
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<PAGE>
PRE-TAX YIELD TO MATURITY (CBE), WEIGHTED AVERAGE LIFE,
FIRST PAYMENT DATE AND LAST PAYMENT DATE
FOR THE CLASS X CERTIFICATES AT THE SPECIFIED CPRS
<TABLE>
<CAPTION>
0% CPR DURING LOCKOUT, DEFEASANCE AND YIELD MAINTENANCE OTHERWISE
AT INDICATED CPR
----------------------------------------------------------------
ASSUMED PRICE (32NDS) 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- --------------------------------------- ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
3-15+ ................................. 11.897% 11.879% 11.856% 11.823% 11.601%
3-16+ ................................. 11.662% 11.644% 11.621% 11.587% 11.363%
3-17+ ................................. 11.430% 11.411% 11.388% 11.355% 11.128%
3-18+ ................................. 11.201% 11.182% 11.159% 11.125% 10.897%
3-19+ ................................. 10.975% 10.957% 10.933% 10.899% 10.669%
3-20+ ................................. 10.753% 10.734% 10.710% 10.676% 10.445%
3-21+ ................................. 10.533% 10.514% 10.490% 10.456% 10.223%
3-22+ ................................. 10.316% 10.298% 10.274% 10.239% 10.004%
3-23+ ................................. 10.103% 10.084% 10.060% 10.025% 9.788%
3-24+ ................................. 9.892% 9.873% 9.849% 9.813% 9.575%
3-25+ ................................. 9.684% 9.665% 9.640% 9.605% 9.365%
3-26+ ................................. 9.479% 9.459% 9.434% 9.399% 9.158%
3-27+ ................................. 9.276% 9.256% 9.231% 9.195% 8.953%
3-28+ ................................. 9.076% 9.056% 9.031% 8.995% 8.751%
3-29+ ................................. 8.878% 8.858% 8.833% 8.797% 8.551%
3-30+ ................................. 8.683% 8.663% 8.638% 8.601% 8.354%
3-31+ ................................. 8.490% 8.470% 8.445% 8.408% 8.159%
Weighted Average Life (yrs.)* ......... 9.237 9.225 9.208 9.184 9.009
First Payment Date .................... Oct-1999 Oct-1999 Oct-1999 Oct-1999 Oct-1999
Last Payment Date ..................... Mar-2016 Mar-2016 Mar-2016 Mar-2016 Dec-2015
</TABLE>
*Based on reduction in the notional amount of the Class X certificates.
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<PAGE>
FEDERAL INCOME TAX CONSEQUENCES
The following summary of the anticipated material federal income tax
consequences of the purchase, ownership and disposition of offered certificates
is based on laws, regulations, including the REMIC regulations promulgated by
the Treasury Department (the "REMIC regulations"), rulings and decisions now in
effect or, with respect to regulations, proposed, all of which are subject to
change, possibly retroactively. To the extent that the following summary
relates to matters of law or legal conclusions with respect thereto, the
summary represents the opinion of Mayer, Brown & Platt, special United States
federal tax counsel for the depositor. This summary does not address the
federal income tax consequences of an investment in offered certificates
applicable to all categories of investors. For example, it does not discuss the
federal income tax consequences of the purchase, ownership and disposition of
offered certificates by investors that are subject to special treatment under
the federal income tax laws, including banks and thrifts, insurance companies,
regulated investment companies, dealers in securities, holders that will hold
the offered certificates as a position in a "straddle" for tax purposes or as
part of a "synthetic security" or "conversion transaction" or other integrated
investment comprised of the offered certificates and one or more other
investments, foreign investors, trusts and estates and pass-through entities,
the equity holders of which are any of the foregoing. Prospective investors
should consult their tax advisors regarding the federal, state, local and any
other tax consequences to them of the purchase, ownership and disposition of
offered certificates.
For federal income tax purposes, three separate REMIC elections will be
made with respect to segregated asset pools which make up the trust, other than
any excess interest collected on the ARD loans. The resulting REMICs will be
referred to in this prospectus supplement as "REMIC I", "REMIC II" and "REMIC
III", respectively. Upon the issuance of the offered certificates, Mayer, Brown
& Platt, counsel to the depositor, will deliver its opinion generally to the
effect that, assuming compliance with all provisions of the pooling and
servicing agreement, for federal income tax purposes, REMIC I, REMIC II and
REMIC III will each qualify as a REMIC under the Internal Revenue Code of 1986,
as amended, called the "Code."
For federal income tax purposes, the Class R-I certificates will be the
sole class of "residual interests" in REMIC I; the Class R-II certificates will
be the sole class of "residual interests" in REMIC II; except to the extent
representing the right to excess interest on the ARD loans, the certificates
(other than the REMIC residual certificates) will evidence the "regular
interests" in, and will be treated as debt instruments of, REMIC III; and the
Class R-III certificates will be the sole class of "residual interests" in
REMIC III. See "Federal Income Tax Consequences--REMICs" in the prospectus.
ORIGINAL ISSUE DISCOUNT AND PREMIUM
The Class X certificates will be, and other offered certificates may be,
treated as having been issued with original issue discount for federal income
tax reporting purposes. For purposes of computing the rate of accrual of
original issue discount, market discount and premium, if any, for federal income
tax purposes, it will be assumed that there are no prepayments on the mortgage
loans, except that it is assumed that the ARD loans will pay their respective
outstanding principal balances on their related anticipated repayment dates. No
representation is made as to the actual expected rate of prepayment of any
mortgage loan. See "Federal Income Tax Consequences--REMICs-- Taxation of Owners
of REMIC Regular Certificates--Original Issue Discount" in the prospectus. The
Class N certificates, in addition to evidencing REMIC regular interests, will
also evidence undivided beneficial interests in the portion of the trust
consisting of any excess interest collected on ARD loans. Such beneficial
interests will constitute interests in a grantor trust for federal income tax
purposes.
The IRS has issued OID Regulations under Sections 1271 to 1275 of the Code
generally addressing the treatment of debt instruments issued with original
issue discount. Purchasers of the offered certificates should be aware that the
OID Regulations and Section 1272(a)(6) of the Code do not adequately address
issues relevant to, or are not applicable to, securities such as the
certificates. For example, because certain classes of certificates bear
interest at the lesser of a fixed rate or a rate based on the weighted average
mortgage rate, it is not entirely clear that the method intended to be used by
the trust fund in reporting
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<PAGE>
such interest (i.e., as "qualified stated interest") would be recognized by the
IRS. In addition, there is considerable uncertainty concerning the application
of Section 1272(a)(6) of the Code and the OID Regulations to REMIC certificates
such as the Class X certificates. The IRS could assert that income derived from
a Class X certificate should be calculated as if the Class X certificate were a
certificate purchased at a premium equal to the price paid by the holder for
the Class X certificate. Under this approach, a holder would be entitled to
amortize such premium only if it has in effect an election under Section 171 of
the Code with respect to all taxable debt instruments held by such holder, as
described in the prospectus under "Federal Income Tax
Consequences--REMICs--Taxation of Owners of REMIC Regular
Certificates--Premium." Alternatively, the IRS could assert that the Class X
certificates should be taxable under regulations governing debt instruments
having one or more contingent payments. Prospective purchasers of the offered
certificates are advised to consult their tax advisors concerning the tax
treatment of the certificates.
Assuming the Class X certificates are treated as having been issued with
original issue discount, it appears that a reasonable method of reporting
original issue discount on the Class X certificates generally would be to
report all income for such certificates as original issue discount for each
period, computing the original issue discount
o by assuming that the value of the applicable index will remain constant for
purposes of determining the original yield to maturity of, and projecting
future distributions on, the certificates, thereby treating the
certificates as fixed rate instruments to which the original issue discount
computation rules described in the prospectus can be applied, and
o by accounting for any positive or negative variation in the actual value of
the applicable index in any period from its assumed value as a current
adjustment to original issue discount for such period.
See "Federal Income Tax Consequences--REMICs--Taxation of Owners of REMIC
Regular Certificates--Original Issue Discount" in the prospectus.
If the method for computing original issue discount described in the
prospectus results in a negative amount to a holder of a Class X certificate
for any period, the amount of original issue discount allocable to such period
would be zero and the certificateholder will be permitted to offset the
negative amount only against future original issue discount (if any) on the
certificate. Although the matter is not free from doubt, a holder of a Class X
certificate may be permitted to deduct a loss to the extent that his or her
remaining basis in the certificate exceeds the maximum amount of future
payments to which the certificateholder is entitled, assuming no further
prepayments of the mortgage loans. Any such loss might be treated as a capital
loss.
The OID Regulations in some circumstances permit the holder of a debt
instrument to recognize original issue discount under a method that differs
from that of the issuer. Accordingly, it is possible that holders of
certificates may be able to select a method for recognizing original issue
discount that differs from that used by the trustee in preparing reports to
certificateholders and the IRS. Prospective investors are advised to consult
their tax advisors concerning the treatment of any original issue discount on
purchased certificates.
Prepayment premiums collected on the mortgage loans will be distributed to
the holders of each class of certificates entitled to the prepayment premiums
as described in this prospectus supplement. It is not clear under the Code when
the amount of a prepayment premium should be taxed to the holder of a class of
certificates entitled to a prepayment premium. For federal income tax reporting
purposes, prepayment premiums will be treated as income to the holders of a
class of certificates entitled to prepayment premiums only after the servicer's
actual receipt of a prepayment premium that the class of certificates is
entitled to under the terms of the pooling and servicing agreement. It appears
that prepayment premiums are to be treated as ordinary income rather than
capital gain. However, the correct characterization of such income is not clear
and certificateholders should consult their tax advisors concerning the
treatment of prepayment premiums.
Certain classes of certificates may be treated for federal income tax
purposes as having been issued at a premium. Whether any holder of a class of
certificates will be treated as holding a certificate with
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<PAGE>
amortizable bond premium will depend on the certificateholder's purchase price
and the distributions remaining to be made on the certificate at the time of
its acquisition by the certificateholder. Holders of each such class of
certificates should consult their tax advisors regarding the possibility of
making an election to amortize such premium. See "Federal Income Tax
Consequences--REMICs--Taxation of Owners of REMIC Regular
Certificates--Premium" in the prospectus.
NEW WITHHOLDING REGULATIONS
The Treasury Department has issued new regulations which make
modifications to the withholding, backup withholding, and information reporting
rules described in the prospectus. The new regulations attempt to unify
certification requirements and to modify reliance standards. The new
regulations will be generally effective for payments made after December 31,
2000. Prospective investors are urged to consult their tax advisors regarding
the new regulations.
CHARACTERIZATION OF INVESTMENTS IN OFFERED CERTIFICATES
Class N certificateholders' right to receive excess interest will be
treated as "stripped coupons" under Section 1286 of the Code. Because excess
interest will arise on the ARD loans only if (contrary to the prepayment
assumption utilized in determining the rate of accrual of original issue
discount, as described above) they do not prepay on their related anticipated
repayment dates, for federal income tax information reporting purposes it will
initially be assumed that no such excess interest will be paid. Consequently,
excess interest will not be reported as income in federal income tax
information reports sent to certificateholders entitled thereto until such
excess interest actually accrues. Similarly, no portion of such holders'
purchase price of their certificates will be treated as allocable to their
right to receive possible distributions of excess interest. However, the
Internal Revenue Service might conceivably disagree with this treatment and
assert that additional income should be accrued with respect to projected
possible payments of excess interest in advance of its actual accrual, that
additional original issue discount income should be accrued with respect to the
affected certificates, or both. Class N certificateholders should consult with
their tax advisors regarding the overall tax consequences of their right to
receive excess interest.
The offered certificates will be "real estate assets" within the meaning
of Section 856(c)(4)(A) of the Code generally in the same proportion that the
assets of the trust would be so treated. In addition, interest (including
original issue discount, if any) on the offered certificates will be interest
described in Section 856(c)(3)(B) of the Code generally to the extent that such
certificates are treated as "real estate assets" within the meaning of Section
856(c)(4)(A) of the Code. Moreover, the offered certificates will be "qualified
mortgages" under Section 860G(a)(3) of the Code if transferred to another REMIC
on its start-up day in exchange for regular or residual interests therein.
The offered certificates will be treated as assets within the meaning of
Section 7701(a)(19)(C) of the Code generally only to the extent of the portion
of the mortgage loans secured by multifamily mortgaged properties. See
"Description of the Mortgage Pool" in this prospectus supplement.
For further information regarding the federal income tax consequences of
investing in the offered certificates, see "Federal Income Tax
Consequences--REMICs" in the prospectus.
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<PAGE>
METHOD OF DISTRIBUTION
The depositor has agreed to sell, and Deutsche Bank Securities Inc. and
Goldman, Sachs & Co. have each agreed to purchase, the portion of the
certificates of each class listed opposite its name in the table below. The
terms of these purchases are governed by an underwriting agreement, dated
August 26, 1999, among the depositor, GMACCM, and each of the underwriters.
It is expected that delivery of the offered certificates will be made only
in book-entry form through the Same Day Funds Settlement System of DTC,
Cedelbank and Euroclear on or about September 14, 1999, against payment
therefor in immediately available funds.
ALLOCATION TABLE
<TABLE>
<CAPTION>
UNDERWRITER CLASS X CLASS A-1-a CLASS A-1-b CLASS A-2 CLASS B CLASS C CLASS D CLASS E CLASS F
- ----------------------- --------- ------------- ------------- ----------- --------- --------- --------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Deutsche Bank
Securities Inc. ...... 50% 50% 50% 50% 50% 50% 50% 50% 50%
Goldman, Sachs & Co. 50% 50% 50% 50% 50% 50% 50% 50% 50%
--- --- --- --- --- --- --- -- --
Total ................. 100% 100% 100% 100% 100% 100% 100% 100% 100%
=== === === === === === === === ===
</TABLE>
In the underwriting agreement, the underwriters have agreed, subject to
the terms and conditions set forth therein, to purchase all of the offered
certificates if any are purchased. If any underwriter defaults, the
underwriting agreement provides that, in certain circumstances, the purchase
commitment of the nondefaulting underwriter may be increased or the
underwriting may be terminated.
The underwriting agreement provides that the obligation of each
underwriter to pay for and accept delivery of its certificates is subject to,
among other things, the receipt of certain legal opinions and to the
conditions, among others, that no stop order suspending the effectiveness of
the depositor's Registration Statement shall be in effect, and that no
proceedings for such purpose shall be pending before or threatened by the
Securities and Exchange Commission.
The distribution of the offered certificates by any underwriter may be
effected from time to time in one or more negotiated transactions, or
otherwise, at varying prices to be determined at the time of the sale. Proceeds
to the depositor from the sale of the offered certificates, before deducting
expenses payable by the depositor to the underwriters, will be approximately
104.21% of the aggregate certificate balance of the offered certificates, plus
accrued interest. Each underwriter may effect such transactions by selling its
certificates to or through dealers, and such dealers may receive compensation
in the form of underwriting discounts, concessions or commissions from the
underwriter for whom they act as agent. In connection with the sale of the
offered certificates, each underwriter may be deemed to have received
compensation from the depositor in the form of underwriting compensation. Each
underwriter and any dealers that participate with such underwriter in the
distribution of the offered certificates may be deemed to be underwriters and
any profit on the resale of the offered certificates positioned by them may be
deemed to be underwriting discounts and commissions under the Securities Act of
1933.
Deutsche Bank Securities Inc. is an affiliate of GACC, Goldman, Sachs &
Co. is an affiliate of GSMC and Newman and Associates, Inc. is an affiliate of
GMACCM.
The depositor will indemnify the underwriters, and under limited
circumstances the underwriters will, severally and not jointly, indemnify the
depositor, against certain civil liabilities under the Securities Act of 1933
or contribute to payments to be made in respect thereof.
A secondary market for the offered certificates may not develop and, if it
does develop, it may not continue. The primary source of ongoing information
available to investors concerning the offered certificates will be the trustee
reports discussed in this prospectus supplement under "Description of the
Certificates--Reports to Certificateholders; Available Information." Except as
described in this prospectus supplement under "Description of the
Certificates--Reports to Certificateholders; Available Information," any
additional information regarding the offered certificates may not be available
through any other source. In addition, the depositor is not aware of any source
through which price information about
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<PAGE>
the offered certificates will be generally available on an ongoing basis. The
limited nature of such information regarding the offered certificates may
adversely affect the liquidity of the offered certificates, even if a secondary
market for the offered certificates becomes available.
LEGAL MATTERS
Certain legal matters will be passed upon for the depositor by Mayer,
Brown & Platt and for the underwriters by Brown & Wood LLP.
RATINGS
The offered certificates are required to receive ratings from Fitch and
Moody's that are not lower than those indicated under "Transaction Overview."
The ratings of the offered certificates address the likelihood of the
timely receipt by holders thereof of all payments of interest (other than
excess interest) to which they are entitled on each distribution date and the
ultimate receipt by holders thereof of all payments of principal to which they
are entitled, if any, by the August, 2036 distribution date. The ratings take
into consideration the credit quality of the mortgage pool, structural and
legal aspects associated with the certificates, and the extent to which the
payment stream from the mortgage pool is adequate to make payments of principal
and interest required under the offered certificates.
The ratings of the offered certificates do not, however, address any of
the following:
o the likelihood or frequency of voluntary or involuntary principal
prepayments on the mortgage loans,
o the degree to which prepayments might differ from those originally
anticipated,
o whether and to what extent prepayment premiums will be collected with
prepayments or the corresponding effect on yield to investors,
o whether and to what extent excess interest will be collected on any ARD
loan,
o whether and to what extent default interest will be collected on the
mortgage loans, and
o the tax treatment of payments on the offered certificates. Generally, the
ratings address credit risk and not prepayment risk.
As described in this prospectus supplement, the amounts payable on the
Class X certificates do not include principal. If all the mortgage loans were
to prepay in the initial month, the Class X certificates would receive only a
single month's interest (without regard to any prepayment premiums that may be
collected). As a result, the Class X certificateholders would suffer a nearly
complete loss of their investment. However, all amounts "due" to such
certificateholders have been paid, and this result would be consistent with the
ratings assigned by the rating agencies to the Class X certificates. The
ratings of the Class X certificates by the rating agencies do not address the
timing or magnitude of reductions of the notional amount of the Class X
certificates, but only the obligation to pay interest timely on the notional
amount of the Class X certificates, as such may be reduced from time to time as
described in this prospectus supplement. Such ratings do not represent any
assessment of the yield to maturity of the Class X certificates or the
possibility that the Class X certificateholders might not fully recover their
investment if rapid prepayments of the mortgage loans (including both voluntary
and involuntary prepayments) occur. The notional amount upon which interest is
calculated for the Class X certificates is reduced by the allocation of
realized losses and prepayments, whether voluntary or involuntary. The rating
does not address the timing or magnitude of reductions of such notional amount,
but only the obligation to pay interest timely on the notional amount as
reduced from time to time. As a result, the ratings of the Class X certificates
should be evaluated independently from similar ratings on other types of
securities.
Any rating agency not requested to rate the offered certificates may
nonetheless issue any rating to any class thereof. A rating assigned to any
class of offered certificates by a rating agency that has not been requested by
the depositor to do so may be lower than the ratings assigned thereto by any
rating agency rating such class.
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<PAGE>
The ratings on the offered certificates should be evaluated independently
from similar ratings on other types of securities. A security rating is not a
recommendation to buy, sell or hold a security and is subject to change or
withdrawal at any time by the assigning rating agency.
LEGAL INVESTMENT
As of the date of their issuance, any offered certificates rated in the
category of "AAA" or "AA" (or the equivalent) by at least one rating agency
will constitute "mortgage related securities" for the purposes of the Secondary
Mortgage Market Enhancement Act of 1984 ("SMMEA"). All other offered
certificates (the "Non-SMMEA certificates") will not constitute "mortgage
related securities" for purposes of SMMEA. As a result, the appropriate
characterization of the Non-SMMEA certificates under various legal investment
restrictions, and thus the ability of investors subject to these restrictions
to purchase the Non-SMMEA certificates of any class, may be subject to
significant interpretative uncertainties. In addition, institutions whose
investment activities are subject to review by federal or state regulatory
authorities may be or may become subject to restrictions in certain forms of
mortgage related securities. The depositor makes no representation as to the
ability of particular investors to purchase the offered certificates under
applicable legal investment or other restrictions. All institutions whose
investment activities are subject to legal investment laws and regulations,
regulatory capital requirements or review by regulatory authorities should
consult with their legal advisors in determining whether and to what extent the
offered certificates constitute legal investments for them or are subject to
investment capital or other restrictions. See "Legal Investment" in the
prospectus.
ERISA CONSIDERATIONS
If you are a fiduciary of any employee benefit plan or other retirement
plan or arrangement, including individual retirement accounts and annuities,
Keogh plans and collective investment funds and separate accounts (and, as
applicable, insurance company general accounts) in which such plans, accounts
or arrangements are invested, that is subject to ERISA and/or Section 4975 of
the Code (each, a "Plan"), you should review with your counsel whether your
purchase or holding of offered certificates could give rise to a transaction
that is prohibited or is not otherwise permitted either under ERISA or Section
4975 of the Code or whether there exists any statutory or administrative
exemption applicable to such "prohibited transactions."
If you purchase or hold the Class A and Class X certificates by, on behalf
of or with "plan assets" of a Plan, your purchase may qualify for exemptive
relief under the Exemption, as described under "ERISA
Considerations--Prohibited Transaction Exemption" in the prospectus and similar
exemptions granted to each of the Underwriters (see Prohibited Transaction
Exemption "PTE" 89-88, 54 Fed. Reg. 42581 (1989), PTE 94-29, 59 Fed. Reg. 14675
(1994) and FAN 97-03-E (December 9, 1996) (unpublished), each as amended by
Prohibited Transaction Exemption 97-34, 62 Fed. Reg. 39021 (1997)). To qualify
for the exemption, however, the Plan must meet a number of conditions,
including the requirement that it must be an "accredited investor" as defined
in Rule 501(a)(1) of Regulation D of the Securities and Exchange Commission
under the Securities Act of 1933, and that at the time of acquisition, the
certificates are rated in one of the top three rating categories by at least
one rating agency. When it issued the exemption, the DOL did not consider
mortgages containing defeasance provisions as described in this prospectus
supplement. Accordingly, it is not clear what the impact on the exemption would
be if such defeasance provisions were exercised. In addition, neither the
exemption nor any similar exemption issued to the underwriters will apply to
the Class B, Class C, Class D, Class E or Class F certificates. As a result, if
you purchase a Class B, Class C, Class D, Class E or Class F certificate or any
interest therein, you will be deemed to have represented by such purchase that
either: (a) you are not a Plan and you are not purchasing such certificates by
or on behalf of, or with "plan assets" of, any Plan or (b) your 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 servicer to any obligation in addition to those
undertaken in the pooling and servicing agreement, and the following conditions
are met: (1) the source of funds that you used to purchase such certificate is
an "insurance company general account" (as such
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<PAGE>
term is defined in PTCE 95-60) and (2) 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. See "ERISA Considerations--Representation From Investing
Plans" in the prospectus.
If you are an insurance company and you would like to invest your general
account assets in the offered certificates, you should consult with your legal
advisors about whether Section 401(c) of ERISA, as described under "ERISA
Considerations--Insurance Company General Accounts" in the prospectus, may
apply to you. The DOL issued proposed regulations under Section 401(c) on
December 22, 1997, but the required final regulations have not been issued as
of the date of this prospectus supplement.
If you are a Plan fiduciary or other person considering whether to
purchase an offered Certificate on behalf of or with "plan assets" of a Plan,
you should consult with your counsel about whether the fiduciary responsibility
provisions of ERISA and the prohibited transaction provisions of ERISA and
Section 4975 of the Code may apply to such investment, and whether the
Exemption or any other prohibited transaction exemption may be available in
connection with your purchase. See "ERISA Considerations" in the prospectus.
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<PAGE>
INDEX OF SIGNIFICANT DEFINITIONS
<TABLE>
<S> <C>
accredited investor ......................... S-102
accrued certificate interest ................ S-69
Additional trust expenses ................... S-74
advances .................................... S-56
Annual debt service ......................... A-2
appraisal reduction amount .................. S-76
Appraised value ............................. A-2
ARD loans ................................... S-16
ARD LTV ..................................... A-3
assumed monthly payment ..................... S-70
available distribution amount ............... S-65
balloon loans ............................... S-28
Balloon or ARD balance ...................... A-3
balloon payment interest excess ............. S-55
balloon payment interest shortfall .......... S-55
base year ................................... S-78
Biltmore Fashion Park loan .................. S-34
CBE ......................................... S-90
Cedelbank participants ...................... S-62
Class A principal distribution
cross-over date ............................. S-68
Class A-1 directed principal cash
flow amounts ................................ S-72
Class A-2 directed principal cash
flow amounts ................................ S-72
Class X components .......................... S-63
clearance cooperative ....................... S-62
CLTV ........................................ A-2
Code ........................................ S-97
Comerica loan ............................... S-43
comparative financial status report ......... S-78
controlling class ........................... S-53
corporate trust office ...................... S-82
corrected mortgage loan ..................... S-52
CPR ......................................... S-85
cross-collateralized mortgage loans ......... S-32
CSSA periodic loan file ..................... S-78
current LTV ................................. A-2
Cut-off date loan-to-value ratio ............ A-2
cut-off date LTV ............................ A-2
debt service coverage ratio ................. S-5
defeasance .................................. A-3
defeasance collateral ....................... S-30
</TABLE>
<TABLE>
<S> <C>
defeasance option ........................... S-30
defeasance period ........................... S-85
delinquent loan status report ............... S-77
depositories ................................ S-61
determination date .......................... S-64
discount rate ............................... S-72
distributable certificate interest .......... S-69
distribution date statement ................. S-77
DSC Ratio ................................... A-2
DSCR ........................................ A-2
due date .................................... S-30
due-on-encumbrance .......................... S-32
due-on-sale ................................. S-32
Equity Inns loan participation .............. S-38
Euroclear operator .......................... S-62
Euroclear participants ...................... S-62
excess interest ............................. S-28
Excess liquidation proceeds ................. S-73
extraordinary prepayment interest
shortfall ................................... S-56
Fitch ....................................... S-10
foreclosure property ........................ S-24
GACC ........................................ S-44
GLA ......................................... S-34
global securities ........................... D-1
GMACCM ...................................... S-44
group 1 mortgage loans ...................... S-65
group 2 mortgage loans ...................... S-65
GSMC ........................................ S-45
historical loan modification report ......... S-77
historical loss estimate report ............. S-78
interest reserve account .................... S-73
interest reserve loans ...................... S-73
liquidation fee ............................. S-55
loan group 1 distribution amount ............ S-66
loan group 1 principal amounts .............. S-71
loan group 2 distribution amount ............ S-66
loan group 2 principal amounts .............. S-71
loan-to-value ratio ......................... A-2
lock ........................................ A-3
lock-up ..................................... D-1
LOP ......................................... S-86
master servicer ............................. S-51
</TABLE>
S-104
<PAGE>
<TABLE>
<S> <C>
master servicing fee rate .............. S-56
mezzanine debt ......................... S-33
modified mortgage loan ................. S-77
monthly payments ....................... S-30
Moody's ................................ S-10
Mortgage rate .......................... A-3
net aggregate prepayment interest
shortfall .............................. S-69
net mortgage rate ...................... S-64
NOI adjustment worksheet ............... S-79
Non-SMMEA certificates ................. S-102
Occupancy .............................. A-3
occupancy as of date ................... A-3
One Colorado Place loan ................ S-41
operating adviser ...................... S-52
operating statement analysis ........... S-78
pass-through rate ...................... S-63
P&I advances ........................... S-75
Plan ................................... S-102
prepayment interest excess ............. S-55
prepayment interest shortfall .......... S-55
prepayment lock-out period ............. S-85
prepayment premium ..................... S-29
prepayment premium entitlement ......... S-71
Prepayment provisions .................. A-3
Prime Outlets loan ..................... S-36
principal balance certificates ......... S-63
principal distribution amount .......... S-70
PTE .................................... S-102
purchase price ......................... S-47
qualified mortgage ..................... S-57
qualified mortgages .................... S-99
rated final distribution date .......... S-57
real estate assets ..................... S-99
Realized losses ........................ S-74
reimbursement rate ..................... S-76
related proceeds ....................... S-56
REMIC I ................................ S-97
REMIC II ............................... S-97
</TABLE>
<TABLE>
<S> <C>
REMIC III .............................. S-97
REMIC regulations ...................... S-97
REO property ........................... S-60
REO status report ...................... S-78
REO tax ................................ S-59
replacement mortgage loan .............. S-48
replacement special servicer ........... S-53
required appraisal loan ................ S-76
Saks Fifth Avenue ...................... S-35
Scheduled maturity date LTV ............ A-3
servicer watch list .................... S-78
Servicing advances ..................... S-56
servicing fee .......................... S-54
Servicing fee rate ..................... A-3
servicing standard ..................... S-51
SMMEA .................................. S-102
special servicer ....................... S-51
special servicing events ............... S-51
special servicing fee .................. S-54
specially serviced mortgage loan ....... S-51
sq. ft ................................. A-2
Square feet ............................ A-2
stated principal balance ............... S-64
subordinate available distribution
amount ................................. S-68
Term to maturity ....................... A-3
terms and conditions ................... S-62
Transaction Overview ................... S-101
trustee reports ........................ S-77
underwritten NCF ....................... A-1
Underwritten net cash flow ............. A-1
Units .................................. A-3
U.S. Person ............................ D-3
UW NCF ................................. A-1
UW NCF DSCR ............................ A-2
voting rights .......................... S-80
weighted average net mortgage rate ..... S-64
withheld amounts ....................... S-73
workout fee ............................ S-54
</TABLE>
S-105
<PAGE>
ANNEX A
CHARACTERISTICS OF THE MORTGAGE LOANS
The schedule and tables appearing in this Annex A set forth certain
information for the mortgage loans and mortgaged properties. The information is
presented, where applicable, as of the cut-off date for each mortgage loan and
the related mortgaged properties. The statistics in such schedule and tables
were derived, in many cases, from information and operating statements
furnished by or on behalf of the respective borrowers. The information and
operating statements were generally unaudited and have not been independently
verified by the depositor or the underwriters or any of their respective
affiliates or any other person. The sum of the amounts in any column of any of
the tables of this Annex A may not equal the indicated total under such column
due to rounding.
Net income for a mortgaged property as determined in accordance with
generally accepted accounting principles would not be the same as the stated
underwritten net cash flow for such mortgaged property as provided in the
following schedule or tables. In addition, underwritten net cash flow is not a
substitute for or comparable to operating income as determined in accordance
with generally accepted accounting principles as a measure of the results of a
property's operations or a substitute for cash flows from operating activities
determined in accordance with GAAP as a measure of liquidity. No representation
is made as to the future net cash flow of the mortgaged properties, nor is the
underwritten net cash flow provided in this prospectus supplement for any
mortgaged property intended to represent such future net cash flow.
In the schedule and tables provided in this Annex A, for mortgage loans
evidenced by one mortgage note, but secured by multiple mortgaged properties,
for some purposes separate amounts for each such related mortgaged property are
shown.
DEFINITIONS
For purposes of the prospectus supplement, including the schedule and
tables in this Annex A, the indicated terms have the following meanings, as
modified, by reference to the "Certain Loan Payment Terms" below and footnotes
to the schedules that follow:
1. "Underwritten net cash flow," "underwritten NCF" or "UW NCF" for any
mortgaged property means an estimate of cash flow available for debt service in
a typical year of stable, normal operations. Generally, it is the estimated
revenue derived from the use and operation of such mortgaged property less the
sum of estimated (a) operating expenses (such as utilities, administrative
expenses, repairs and maintenance, management and franchise fees and
advertising), (b) fixed expenses (such as insurance, real estate taxes and, if
applicable, ground lease payments), (c) capital expenditures and reserves for
capital expenditures, including tenant improvement costs and leasing
commissions, as applicable, and (d) allowance for vacancies and losses.
Underwritten net cash flow generally does not reflect interest expense and
non-cash items such as depreciation and amortization. The underwritten net cash
flow for each mortgaged property is calculated on the basis of numerous
assumptions and subjective judgments, which, if ultimately proven erroneous,
could cause the actual net cash flow for such mortgaged property to differ
materially from the underwritten net cash flow for any mortgaged property. Some
assumptions and subjective judgments relate to future events, conditions and
circumstances, including future expense levels, the re-leasing of vacant space
and the continued leasing of occupied space, that will be affected by a variety
of complex factors over which none of the depositor, the sellers or the
servicer have control. In some cases, the underwritten net cash flow for any
mortgaged property is higher, and may be materially higher, than the annual net
cash flow for that mortgaged property, based on historical operating
statements.
In determining underwritten net cash flow for a mortgaged property, the
seller generally relied on rent rolls and/or other generally unaudited
financial information provided by the respective borrowers. In some cases the
appraisal and/or local market information was the primary basis for the
determination. From that information, the seller calculated stabilized
estimates of cash flow that took into consideration historical financial
statements (where available), material changes in the operating position of a
mortgaged property of which the applicable seller was aware (e.g., newly signed
leases, expirations of "free rent" periods and market rent and market vacancy
data), and estimated capital expenditures, leasing
A-1
<PAGE>
commission and tenant improvement reserves. In some cases, the applicable
seller's estimate of underwritten net cash flow reflected differences from the
information contained in the operating statements obtained from the respective
borrowers (resulting in either an increase or a decrease in the estimate of
underwritten net cash flow derived therefrom) based upon the seller's own
analysis of those operating statements and the assumptions applied by the
respective borrowers in preparing those statements and information. In some
instances, for example, property management fees and other expenses may have
been taken into account in the calculation of underwritten net cash flow even
though these expenses may not have been reflected in actual historic operating
statements. In most of those cases, the information was annualized, with
adjustments for items deemed not appropriate to be annualized, before using it
as a basis for the determination of underwritten net cash flow. No assurance
can be given with respect to the accuracy of the information provided by any
borrowers, or the adequacy of the procedures used by any seller in determining
the presented operating information.
2. "Annual debt service" generally means, for any mortgage loan, 12 times
the monthly payment in effect as of the cut-off date for such mortgage loan or,
for some mortgage loans that pay interest for only a period of time, 12 times
the monthly payment in effect at the end of such period.
3. "UW NCF DSCR," "underwritten NCF DSCR," "debt service coverage ratio,"
"DSC Ratio" or "DSCR" means, for any mortgage loan, (a) the underwritten net
cash flow for the mortgaged property, divided by (b) the annual debt service
for such mortgage loan, assuming for the purposes of this Annex A, except as
otherwise indicated, in the case of the mortgage loans providing for earn-out
reserves (which, if the conditions for release are not met by a certain date,
would be used to partially prepay or defease the mortgage loan), that the
principal balance of the mortgage loan is reduced by the amount of the
earn-out.
Generally, debt service coverage ratios are used by income property
lenders to measure the ratio of (a) cash currently generated by a property that
is available for debt service to (b) required debt service payments. However,
debt service coverage ratios measure only the current, or recent, ability of a
property to service mortgage debt. If a property does not possess a stable
operating expectancy (for instance, if it is subject to material leases that
are scheduled to expire during the loan term and that provide for above-market
rents and/or that may be difficult to replace), a debt service coverage ratio
may not be a reliable indicator of a property's ability to service the mortgage
debt over the entire remaining loan term. The underwritten NCF DSCRs are
presented in this prospectus supplement for illustrative purposes only and, as
discussed above, are limited in their usefulness in assessing the current, or
predicting the future, ability of a mortgaged property to generate sufficient
cash flow to repay the related mortgage loan. As a result, no assurance can be
given, and no representation is made, that the underwritten NCF DSCRs
accurately reflect that ability. The underwritten NCF DSCR for the
interest-only mortgage loans is based on the payment due after the
interest-only period, and for the step amortization mortgage loans is based on
the payment due as of the cut-off date or the payment due after the
interest-only period, as applicable.
4. "Appraised value" means, for any mortgaged property, the appraiser's
adjusted value as stated in the most recent third-party appraisal available to
the depositor. In some cases, the appraiser's adjusted value takes into account
certain repairs or stabilization of operations. In some cases in which the
appraiser assumed the completion of repairs, such repairs were, generally,
either completed before the delivery date or the seller has taken reserves
sufficient to complete such repairs. No representation is made that any such
value would approximate either the value that would be determined in a current
appraisal of the related mortgaged property or the amount that would be
realized upon a sale.
5. "Cut-off date loan-to-value ratio," "loan-to-value ratio," "cut-off
date LTV," "current LTV," or "CLTV" means, with respect to any mortgage loan,
(a) the cut-off date balance of that mortgage loan (generally net of earn-out
reserves or additional collateral, if applicable) divided by (b) the appraised
value of the mortgaged property or mortgaged properties. For mortgage loans for
which earn-out reserves have been established, cut-off date loan-to-value ratio
is shown assuming that the earn-out is not achieved, except as otherwise
indicated.
6. "Square feet" or "sq. ft." means, in the case of a mortgaged property
operated as a retail center, office or medical office complex,
industrial/warehouse facility, combination retail office facility or other
special purpose property, the square footage of the net rentable or leasable
area.
A-2
<PAGE>
7. "Units" means: (1) in the case of a mortgaged property operated as
multifamily housing, the number of apartments, regardless of the size of or
number of rooms in the apartment and (2) in the case of a mortgaged property
operated as a hospitality property, the number of guest rooms. For purposes of
this Annex A, the total number of units shown for certain multifamily
properties may be greater than the total number of multifamily units shown in
the multifamily schedule because certain of the multifamily properties have
commercial units in addition to multifamily units.
8. "Occupancy" means the percentage of square feet or units, as the case
may be, of the mortgaged property that was occupied or leased or, in the case
of certain properties, average units so occupied over a specified period, as of
a specified date (identified on this Annex A as the "occupancy as of date") or
as specified by the borrower or as derived from the mortgaged property's rent
rolls, operating statements or appraisals or as determined by a site inspection
of the mortgaged property. Information in this Annex A concerning the "largest
tenant" is presented as of the same date as of which the occupancy percentage
is specified.
9. "Balloon or ARD balance" means, for any balloon loan or ARD loan, the
principal amount that will be due at maturity or on the anticipated repayment
date for that balloon loan or ARD loan. 58 loans representing 35.90% of the
aggregate cut-off date balance accrue interest on an actual/360 basis but have
a monthly payment calculated on a 30/360 schedule. Accordingly, the actual
amortization term is longer for these loans than the stated amortization term
reflected in this Annex A.
10. "Scheduled maturity date LTV" or "ARD LTV" means, for any balloon loan
or ARD loan, the Balloon or ARD Balance for that mortgage loan divided by the
appraised value of the related mortgaged property.
11. "Mortgage rate" means, for any mortgage loan, the mortgage rate in
effect as of the cut-off date for that mortgage loan.
12. "Servicing fee rate" for each mortgage loan is the percentage rate per
annum provided in Annex A for such mortgage loan at which compensation is
payable for the servicing of that mortgage loan (which includes the master
servicing fee rate) and at which compensation is also payable to the trustee.
13. "Prepayment provisions" for each mortgage loan are: "lock," which
means the duration of lockout period, and "defeasance," which means the
duration of any defeasance period. The number following the "/" is the number
of months for which the related call protection provision is in effect,
exclusive of the maturity date for calculation purposes only.
14. "Term to maturity" means, for any mortgage loan, the remaining term,
in months, from the cut-off date for that mortgage loan to the earlier of the
related maturity date or anticipated repayment date.
15. In those instances where the same tenant leases space under multiple
leases, the date shown as the "Largest Tenant Lease Expiration" is the earliest
termination date of any of such leases.
INTEREST ONLY LOANS
Loan Number 21674. The mortgage loan requires monthly payments of interest
only (calculated using actual/360 interest accrual method) from July 10, 1999
through June 10, 2001. Commencing on July 10, 2001 and continuing through
maturity, monthly payments of principal and interest in the amount of
$132,474.71 are required.
Loan Number 22232. The mortgage loan requires monthly payments of interest
only (calculated using actual/360 interest accrual method) from September 10,
1999 through August 10, 2001. Commencing on September 10, 2001 and continuing
through maturity, monthly payments of principal and interest in the amount of
$65,407.85 are required.
Loan Number 22673. The mortgage loan requires monthly payments of interest
only (calculated using actual/360 interest accrual method) from August 10, 1999
through July 10, 2000. Commencing on August 10, 2000 and continuing through
maturity, monthly payments of principal and interest in the amount of
$575,491.93 are required.
A-3
<PAGE>
Loan Number 22941. The mortgage loan requires monthly payments of interest
only (calculated using actual/360 interest accrual method) from September 10,
1999 through August 10, 2001. Commencing on September 10, 2001 and continuing
through maturity, monthly payments of principal and interest in the amount of
$54,876.08 are required.
Loan Number 834884757. The mortgage loan requires monthly payments of
interest only (calculated using an actual/360 interest accrual method) from
October 1, 1999 through August 1, 2003. Commencing on September 1, 2003 and
continuing through maturity, monthly payments of principal and interest in the
amount of $168,605.53.
Loan Number 090001263. The mortgage loan requires monthly payments of
interest only (calculated using an actual/360 interest accrual method) from
September 1, 1999 through its maturity on August 1, 2009 in the amount of
$70,608.96.
CERTAIN REPLACEMENT RESERVES AND TENANT IMPROVEMENT AND LEASING COMMISSION
RESERVES
Loan Number 090001264. The mortgage loan requires a new lease escrow fund
to be established at closing with a deposit of $45,000.00. These funds will be
released to the borrower when the new lease conditions are met. These
conditions will be met when the borrower enters into a lease covering the space
in the improvements identified as Suite 350 containing not less than 4,326 net
rentable square feet for a term of not less than three years at a basic rental
rate of not less than $16.00 per square foot.
Loan Number 090001253. The mortgage loan requires monthly reserve payments
in the amount of $4,166.67 to the rollover escrow fund in connection with the
Albertson's lease. The borrower shall not be required to make any deposits into
the fund in excess of $350,000.00. Also the borrower is required to deposit any
funds received from the tenant under the Albertson's lease into the rollover
escrow fund.
Loan Number 914565048. The mortgage loan requires the borrower to deposit
$100,000.00 at closing into the rollover escrow fund. If at any time the
balance in the fund goes below $100,000.00 the borrower must pay monthly
deposits of $10,000.00 to the fund until the balance in the fund is again up to
$100,000.00.
Loan Number 090001243. The mortgage loan requires the borrower to deposit
$100,000.00 at closing into the Astoria escrow fund for tenant improvement and
leasing commission obligations incurred with respect to the Astoria premises
leased to Astoria Federal Mortgage.
Loan Number 090001254. The mortgage loan requires the borrower to make
monthly payments of $6,330.00 into the rollover escrow fund. Once the balance
of the fund reaches $250,000.00, monthly payments will not be collected. If the
balance falls below $250,000.00, then monthly payments will begin until the
balance reaches $250,000.00. The borrower deposited $137,862.00 into the near
term rollover escrow fund for expenses relating to the renewal of the SSC Yoga,
Zero Pro Shop, Hair Pro and 4M Cleaners leases.
Loan Number 090001256. The mortgage loan requires the borrower to deposit
$150,000.00 for tenant improvements and leasing commission obligations related
to the Wiener's Store lease. Once the balance of the fund reaches $250,000.00,
monthly payments will not be collected. If the balance falls below $250,000.00,
then monthly payments will begin until the balance reaches $250,000.00
Loan Number 090001261. The mortgage loan requires the borrower to make
monthly payments of $1,283.00 into the rollover escrow fund. Once the balance
of the fund reaches $50,000.00, monthly payments will not be collected. If the
balance falls below $50,000.00, then monthly payments will begin until the
balance reaches $50,000.00. The borrower was also required to fund $9,600.00
into the free rent reserve account. These funds will be released when the free
rent period of the Wilkerson Printing lease has expired.
Loan Number 090001251. The mortgage loan requires the borrower to make
monthly payments of $417.00 into the rollover escrow fund for tenant
improvements and leasing commissions pertaining to the Michael's Store and
Payless Shoesource leases. The renewal of the Michael's lease cannot be any
less than 19,510 sq. ft. at no less than $6.50 a sq. ft. and for a term not
less than five years. The renewal of the Payless lease cannot be any less than
3,000 sq. ft. at no less than $12.00 a sq. ft. and for a term not less than
five years.
A-4
<PAGE>
Loan Number 834884757. The mortgage loan requires a two month payment
reserve established at closing for $425,718.40. This reserve is two months of
principal and interest plus any applicable reserves. Funds can be drawn from
the reserve in the event that the mortgagee has not received the payment within
five days of the date the monthly payment is due.
Loan Number 21674. The borrower has posted a letter of credit in lieu of a
required deposit of $700,000 and monthly payments of $5,500 into a tenant
improvement and leasing commission reserve. The borrower has posted a letter of
credit in lieu of required monthly payments of $9,121.25 into a replacement
reserve.
Loan Number 22040. The borrower has posted a letter of credit in lieu of a
required initial deposit of $60,000 into a tenant improvement and leasing
commission reserve. The mortgage loan also requires monthly tenant improvement
leasing commission reserve payments in the amount of $5,000 until the balance
reaches $350,000.
Loan Number 22686. The mortgage loan requires the borrower to deliver a
letter of credit in the amount of $250,000 as additional security for the loan
pending delivery of an acceptable subordination, nondisturbance and attornment
agreement from each of the required tenants.
Loan Number 22738. The mortgage loan requires monthly tenant improvements
and leasing commissions payments in the amount of $4,499. The borrower may
provide a letter of credit in lieu of the monthly payments.
Loan Number 22868. The mortgage loan requires an initial deposit of
$800,000 or a letter of credit at closing for tenant improvement and leasing
commision reserves and debt service reserves.
Loan Number 21568. The mortgage loan requires monthly reserve payments in
an amount equal to one-twelfth of five percent of the total gross revenues
derived from the operation of the property during the immediately preceding
calendar year for replacements and capital improvements.
Loan Number 22103. The mortgage loan requires monthly reserve payments in
an amount equal to one-twelfth of four percent of the total gross revenues
derived from the operation of the properties during the immediately preceding
calendar year.
Loan Number 23290. The mortgage loan requires monthly reserve payments in
an amount equal to one-twelfth of five percent of the total gross revenues
derived from the operation of the properties during the immediately preceding
calendar year.
Loan Number 24117. The mortgage loan requires monthly reserve payments in
an amount equal to one-twelfth of four percent of the total gross revenues
derived from the operation of the properties during the immediately preceding
calendar year.
ADDITIONAL COLLATERAL LOAN
Loan Number TA5222. The mortgage loan requires the borrower to make
payments into a reserve account in an amount equal to $33,333 per month
commencing on the due date in April 2004 until the anticipated repayment date
if the borrower fails to furnish an irrevocable letter of credit each year in
the amount of $550,000 commencing in April, 2004 and annually each year
thereafter until the anticipated repayment date for that loan.
EARNOUT LOANS
"Earnout loans" are mortgage loans that require the related borrower to
deposit a portion of the original loan amount in a reserve fund pending
satisfaction of certain conditions, including without limitation, achievement
of certain DSCRs, CLTVs or satisfaction of certain occupancy tests. Each
earnout loan provides that in the event the conditions are not met by a certain
date, the servicer may apply amounts held in the reserves to prepay or
partially defease the related mortgage loan. For each of the earnout loans
listed below, the earliest date on which any amounts may be so applied is set
forth beneath the caption "Earliest Defeasance or Prepay Date." For each of
these earnout loans, the underwritten NCF
A-5
<PAGE>
DSCRs and CLTVs shown in this prospectus supplement and on the foldout pages in
this Annex A are calculated based on the principal balance of those mortgage
loans net of the related earnout amount. Those underwritten DSCRs and CLTVs are
also shown beneath the caption "Net of Earnout Underwritten NCF DSCR" and "Net
of Earnout LTV" in the table below. The amounts beneath the captions "Full
Balance Cut-Off Date LTV" and "Full Balance Cut-Off Date NCF DSCR" are
calculated based on a principal balance of those mortgage loans that includes
the related earnout amount. The following table sets forth certain information
regarding the earnout loans:
<TABLE>
<CAPTION>
FULL BALANCE
CONTROL EARNOUT CUT-OFF DATE CUT-OFF DATE NET OF
NO LOAN NO. AMOUNT BALANCE LTV EARNOUT LTV
- --------- ------------ ------------- -------------- -------------- -------------
<S> <C> <C> <C> <C> <C>
34 19282 $1,645,000 $ 9,296,027 71.2% 58.58%
43 20869 1,500,000 7,386,955 54.3 43.29
23 21223 1,708,000 12,427,897 74.9 64.58
57 22603 380,000 6,028,410 69.3 64.92
19 22868 3,000,000 14,493,350 67.4 53.46
12 906995296 3,000,000 20,990,264 84.0 71.96
17 826165831 750,000 15,242,981 68.8 65.43
<CAPTION>
NET OF EARLIEST
FULL BALANCE EARNOUT DEFEASANCE PREPAYMENT
CONTROL CUT-OFF DATE UNDERWRITTEN OR PREPAY DEFEASANCE PENALTIES
NO NCF DSCR NCF DSCR DATE OR PREPAY APPLY?
- --------- -------------- -------------- ------------ ---------------- -----------
<S> <C> <C> <C> <C> <C>
34 1.34x 1.63x 2/1/2000 Prepay Yes
43 1.30 1.62 5/12/2001 Defease NAP
23 1.14 1.32 11/27/2000 Prepay Yes
57 1.12 1.20 6/11/2000 Prepay Yes
19 1.34 1.69 4/30/2000 Defease/Prepay NAP/Yes
12 1.19 1.39 10/30/2000 Prepay Yes
17 1.44 1.44 2/28/2000 Prepay Yes
</TABLE>
A-6
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<PAGE>
<TABLE>
<CAPTION>
CONTROL NUMBER LOAN GROUP (#) LOAN SELLER LOAN NUMBER PROPERTY NAME
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 1 GMAC 22673 Biltmore Fashion Park
2 1 GMAC 21893 Prime Outlets at Niagara Falls
- -----------------------------------------------------------------------------------------------------------------------------------
3 1 GMAC 22103 Equity Inns Portfolio
3a 1 GMAC 22103-A Equity Inns - AmeriSuites (Overland Park)
3b 1 GMAC 22103-B Equity Inns - AmeriSuites (Columbus)
3c 1 GMAC 22103-C Equity Inns - AmeriSuites (Memphis)
3d 1 GMAC 22103-D Equity Inns - AmeriSuites (Glen Allen)
3e 1 GMAC 22103-E Equity Inns - Hampton Inn (Overland Park)
3f 1 GMAC 22103-F Equity Inns - Hampton Inn (Kansas City)
3g 1 GMAC 22103-G Equity Inns - Hampton Inn (Memphis)
3h 1 GMAC 22103-H Equity Inns - Hampton Inn (Richardson)
3I 1 GMAC 22103-I Equity Inns - Hampton Inn (Morgantown)
3j 1 GMAC 22103-J Equity Inns - Homewood Suites (Phoenix)
3k 1 GMAC 22103-K Equity Inns - Homewood Suites (Sharonville)
3l 1 GMAC 22103-L Equity Inns - Homewood Suites (San Antonio)
3m 1 GMAC 22103-M Equity Inns - Residence Inn (Tucson)
3n 1 GMAC 22103-N Equity Inns - Residence Inn (Eagan)
3o 1 GMAC 22103-O Equity Inns - Residence Inn (Tinton Falls)
3p 1 GMAC 22103-P Equity Inns - Residence Inn (Portland)
3q 1 GMAC 22103-Q Equity Inns - Hampton Inn (Northville)
3r 1 GMAC 22103-R Equity Inns - Residence Inn (Princeton)
- -----------------------------------------------------------------------------------------------------------------------------------
4 1 GMAC 22686 One Colorado
5 1 DB GA5152 Comerica Bank Building
6 1 DB TA5222 120 Monument Circle
7 1 AR 914142539 125 Maiden Lane
- -----------------------------------------------------------------------------------------------------------------------------------
8 2 GMAC 21584 Texas Development Investors Apartment Portfolio
8a 2 GMAC 21584-A Willow Creek Apartments
8b 2 GMAC 21584-B Bellfort Southwest IV and V Apartments
8c 2 GMAC 21584-C Southwest Village Apartments
8d 2 GMAC 21584-D Bellfort Southwest III
- -----------------------------------------------------------------------------------------------------------------------------------
9 1 GMAC 22671 Sherman Plaza East & West Tower
10 2 DB GA5851 Alliance TP Portfolio
10a 2 DB GA5851-A Mulberry Lane Apartments
10b 2 DB GA5851-B Rambletree Apartments
10c 2 DB GA5851-C Robin Oaks Apartments
- -----------------------------------------------------------------------------------------------------------------------------------
11 1 AR 834884757 Bush Tower
12 1 AR 906995296 County Line Plaza
13 2 DB GA5614 Sherwood Lakes Apartments
- -----------------------------------------------------------------------------------------------------------------------------------
14 2 GMAC 22748 Laurel Apartment Portfolio
14a 2 GMAC 22748-A Laurel Walk Apartments
14b 2 GMAC 22748-B Laurel Oaks Apartments
14c 2 GMAC 22748-C Laurel Springs Apartments
- -----------------------------------------------------------------------------------------------------------------------------------
15 1 GMAC 21674 Sweet Paper Warehouse
15a 1 GMAC 21674-A Sweet Paper Warehouse - Hialeah
15b 1 GMAC 21674-B Sweet Paper Warehouse - Atlanta
15c 1 GMAC 21674-C Sweet Paper Warehouse - Tampa
15d 1 GMAC 21674-D Sweet Paper Warehouse - Orlando
15e 1 GMAC 21674-E Sweet Paper Warehouse - Raleigh
- -----------------------------------------------------------------------------------------------------------------------------------
16 1 DB TA7316 Sheraton Portsmouth Hotel
17 1 AR 826165831 Trinity Commons Shopping Center
18 2 DB TA1103 Village Square Apartments
19 1 GMAC 22868 Golden Books Industrial Building
20 1 GMAC 23226 Air Touch Building
- -----------------------------------------------------------------------------------------------------------------------------------
21 2 GMAC 23908 Tivoli Lakes Club Apartments
22 1 GMAC 23007 InteSys Technologies, Inc.
23 1 GMAC 21223 Hampden Park West/NCI & II
23a 1 GMAC 21223-A Hampden Park West
23b 1 GMAC 21223-B NCI Buildings I and II
- -----------------------------------------------------------------------------------------------------------------------------------
24 2 GMAC 23650 Columbus Park Apartments
25 1 DB GA4992 The Towers on Wilshire
26 1 GMAC 20656 Courtyard by Marriott - Charleston
27 1 AR 09-0001254 Hillcrest Village Shopping Center
28 1 AR 09-0001263 Briargrove Place
- -----------------------------------------------------------------------------------------------------------------------------------
29 1 AR 09-0001253 Pitman Corners Shopping Center
30 1 DB GA5891 The Harbor Building
31 1 GMAC 22760 Sheraton Cerritos
32 2 AR 09-0001248 Plantation Oaks
33 1 DB TA0216 The Leamington Office Building
- -----------------------------------------------------------------------------------------------------------------------------------
34 1 GMAC 19282 Pacific East Oriental ShoppingMall
35 2 GMAC 22396 Riverbend and Cedar Lake Apartments
35a 2 GMAC 22396-A Riverbend Apartments
35b 2 GMAC 22396-B Cedar Lake Apartments
36 1 GMAC 22232 40 Corporate Center
- -----------------------------------------------------------------------------------------------------------------------------------
37 1 GMAC 22040 Milpitas R&D Buildings
38 1 GMAC 24117 Residence Inn - Foxborough
39 1 DB TA7051 Rancho San Diego Town and Country Phase I
40 1 GMAC 21704 Cragwood Plaza
41 1 AR 09-0001229 Lakeside Place Office Building
- -----------------------------------------------------------------------------------------------------------------------------------
42 1 GMAC 22941 Heritage Office Building
43 1 GMAC 20869 The Jewelry Building
44 1 GMAC 19631 Century Park West Office Building
45 2 GMAC 22471 Austin Lights Apartments
46 1 DB TA2087 IRS Building
- -----------------------------------------------------------------------------------------------------------------------------------
47 1 GMAC 21517 Preferred Freezer II
48 2 GMAC 19169 St. Augustine Hills Apartments
49 1 GMAC 20599 Ohio Distribution Warehouse
50 1 AR 09-0001255 Burleson Towne Centre
51 1 GMAC 20808 Quinby Office Building (CA)
- -----------------------------------------------------------------------------------------------------------------------------------
52 1 AR 09-0001264 Shiloh Square Shopping Center
53 1 DB TA1852 Commonwealth Plaza
54 1 GMAC 23290 AmeriSuites - Irving
55 1 AR 901905420 Windward Town & Country Plaza
56 1 GMAC 21568 Residence Inn - Glendale
- -----------------------------------------------------------------------------------------------------------------------------------
57 2 GMAC 22603 The Bridgeport Apartments
58 1 GMAC 23492 One Corporate Plaza
59 1 AR 09-0001261 Losee Business Park
60 2 AR 09-0001260 Chimney Apartments
- -----------------------------------------------------------------------------------------------------------------------------------
61 2 DB TA5740 Jackson Heights Portfolio
61a 2 DB TA5740-A 35-18 95th Street
61b 2 DB TA5740-B 35-24 95th Street
61c 2 DB TA5740-C 35-38 95th Street
61d 2 DB TA5740-D 35-44 95th Street
61e 2 DB TA5740-E 93-35 Lamont Avenue
- -----------------------------------------------------------------------------------------------------------------------------------
62 2 AR 911660589 1110-1120 Beacon Street
63 1 AR 906950814 Buckingham Place Shopping Center
64 2 GMAC 22788 Plaza Apartments
65 1 GMAC 22098 Sears Distribution Center
66 1 GMAC 22729 Fremont Business Park
- -----------------------------------------------------------------------------------------------------------------------------------
67 2 GMAC 22124 Chase Hill Apartments
68 1 DB TA3432 Architect's Building
69 1 DB GA5283 Madison Square Shopping Center
70 2 GMAC 22252 Villa Mirage Apartments
71 2 GMAC 20670 Summerchase Apartments
- -----------------------------------------------------------------------------------------------------------------------------------
72 1 AR 09-0001243 Crystal Heights Office Center
73 1 AR 09-0001251 Boca Chica Place
74 1 GMAC 19020 The Shops at Pennsville Shopping Center - A Note
- -----------------------------------------------------------------------------------------------------------------------------------
75 2 DB TA2352 Satcoms Apartments
75a 2 DB TA2352-A French Quarter Apartments
75b 2 DB TA2352-B Crescent Plaza Apartments
75c 2 DB TA2352-C 2101 D Street Apartments
75d 2 DB TA2352-D Willow Wood Apartments
75f 2 DB TA2352-F Arapahoe Village Apartments
- -----------------------------------------------------------------------------------------------------------------------------------
76 2 AR 09-0001242 Sharpstown Garden Apartments
77 1 AR 904900980 Kennedy Business Center
78 1 AR 906424723 East Lancaster Plaza
79 1 GMAC 22738 University Corporate Center
80 2 AR 901851850 Summer Pointe & Windrock Apartments
- -----------------------------------------------------------------------------------------------------------------------------------
81 1 AR 909033753 Comps Plaza
82 1 DB TA4891 Francisco Center II
83 2 DB TA4664 St. James Garden Apartments
84 1 GMAC 22149 14th & Cary Street Parking Deck
85 1 GMAC 22136 Willow Oak Plaza
- -----------------------------------------------------------------------------------------------------------------------------------
86 2 AR 907120356 Community Manor Apartments
87 1 GMAC 21668 Fairporte Green Shopping Center
88 1 AR 914565048 Lanham Center
89 2 AR 09-0001257 Courts of McCallum Apartments
90 1 AR 09-0001249 Bucks County Mall
- -----------------------------------------------------------------------------------------------------------------------------------
91 1 AR 09-0001256 San Marcos Place
92 2 DB TA7792 Mallard Creek Apartments
93 1 GMAC 22272 Carriage Center Retail
94 1 GMAC 22369 Delta Plaza Shopping Center
95 1 AR 09-0001246 Tri-State Mini Storage
- -----------------------------------------------------------------------------------------------------------------------------------
96 1 GMAC 20311 McKinney Square
97 1 DB TA7147 Palmetto Lakes Business Center
98 1 DB TA7423 Westlake Medical Plaza
99 1 GMAC 22393 Capital Title Building
100 1 AR 907881339 The North Central Office Building
- -----------------------------------------------------------------------------------------------------------------------------------
101 1 GMAC 22669 Scott Company of California
102 1 DB TA6017 420 Columbus Avenue
103 2 GMAC 23193 Rivercrest Apartments
104 1 AR 802880743 McCarty Building
105 2 GMAC 21956 Canden-Damada Apartments
- -----------------------------------------------------------------------------------------------------------------------------------
106 2 AR 09-0001245 Citadel Apartments
107 1 GMAC 22542 Fairview Center (Parkside Plaza - Food Lion Shopping Ctr.)
108 1 GMAC 19644 100 Morris Avenue
109 1 GMAC 22156 Delta Villa
110 2 GMAC 21857 Los Olivos Apartments
- -----------------------------------------------------------------------------------------------------------------------------------
111 1 AR 09-0001262 Commerce Exchange Business Park
112 2 GMAC 21775 Wickham Gardens Condominiums
113 2 GMAC 21159 The Commodore Apartments
114 2 GMAC 18842 South Park Apartments
115 1 AR 828634107 Fountain Village S.C.
- -----------------------------------------------------------------------------------------------------------------------------------
116 1 DB TA7225 Tollhouse Shopping Center
117 1 DB TA5907 Sandpiper Mobile Manor
118 2 GMAC 23338 Logan Point Apartments
119 1 DB TA6162 Rushton Portfolio
119a 1 DB TA6162-A 2 Andrews Drive
119b 1 DB TA6162-B 4 Andrews Drive
- -----------------------------------------------------------------------------------------------------------------------------------
120 1 GMAC 22102 Equity Inns - AmeriSuites (Indianapolis)
121 1 DB TA1940 47-16 Austell Place
122 1 GMAC 22649 For Eyes Optical
123 2 GMAC 18035 Canyon Hills Apartments
124 1 DB TA4639 Kailua Trade Center
125 2 GMAC 22494 Oak Forest Apartments
- -----------------------------------------------------------------------------------------------------------------------------------
126 1 GMAC 22038 Santee Plaza
127 1 AR 09-0001244 Tanglewood Business Park
128 1 GMAC 21211 CVS Pharmacy Baltimore
129 1 DB TA2896 Ahwatukee Office Plaza
130 1 AR 09-0001220 4444 Westgrove
- -----------------------------------------------------------------------------------------------------------------------------------
131 1 DB TA4588 4751 White Lane
132 2 GMAC 23294 Park West I Apartments
133 1 DB TA7458 North Dawson Business Center
134 1 DB TA6357 228 Lackawana Avenue
135 1 GMAC 21368 718 North Lake Avenue
- -----------------------------------------------------------------------------------------------------------------------------------
136 2 DB TA5681 Park Villa Apartments
137 1 GMAC 20245 Marshall Plaza
138 2 GMAC 21856 13400 Victory Apartments
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CONTROL NUMBER PROPERTY TYPE ADDRESS CITY STATE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 Anchored Retail 2470-A East Camelback Road Phoenix Arizona
2 Anchored Retail 1900 Military Road Niagara Falls New York
- ------------------------------------------------------------------------------------------------------------------------------------
3 Lodging
3a Lodging 6801 West 112th Street Overland Park Kansas
3b Lodging 7490 Vantage Drive Columbus Ohio
3c Lodging 7905 Giacosa Place Memphis Tennessee
3d Lodging 4100 Cox Road Glen Allen Virginia
3e Lodging 10591 East Metcalf Frontage Road Overland Park Kansas
3f Lodging 11212 North Newark Circle Kansas City Missouri
3g Lodging 5320 Poplar Avenue Memphis Tennessee
3h Lodging 1577 Gateway Boulevard Richardson Texas
3I Lodging 1053 Van Voorhis Road Morgantown West Virginia
3j Lodging 2001 East Highland Avenue Phoenix Arizona
3k Lodging 2670 East Kemper Road Sharonville Ohio
3l Lodging 4323 Spectrum One San Antonio Texas
3m Lodging 6477 East Speedway Boulevard Tucson Arizona
3n Lodging 3040 Eagandale Place Eagan Minnesota
3o Lodging 90 Park Road Tinton Falls New Jersey
3p Lodging 1710 Northeast Multnomah Street Portland Oregon
3q Lodging 20600 Haggerty Road Northville Michigan
3r Lodging 4225 Route 1 Princeton New Jersey
- ------------------------------------------------------------------------------------------------------------------------------------
4 Anchored Retail One Colorado Boulevard Pasadena California
5 Office 33 West Santa Clara Street San Jose California
6 Office 120 Monumnet Circle Indianapolis Indiana
7 Office 125 Maiden Lane New York New York
- ------------------------------------------------------------------------------------------------------------------------------------
8 Multifamily Houston Texas
8a Multifamily 7575 Office Center Drive Houston Texas
8b Multifamily 8201 West Bellfort Avenue Houston Texas
8c Multifamily 11726 West Bellfort Avenue Houston Texas
8d Multifamily 6400 West Bellfort Avenue Houston Texas
- ------------------------------------------------------------------------------------------------------------------------------------
9 Office 15350 and 15400 Sherman Way Van Nuys California
10 Multifamily
10a Multifamily 2630 Abbott Road Midland Michigan
10b Multifamily 326 Ramblewood Drive Glen Ellyn Illinois
10c Multifamily 1819 Eastlawn Drive Midland Michigan
- ------------------------------------------------------------------------------------------------------------------------------------
11 Office 130 W 42nd Street New York New York
12 Anchored Retail 1051 East County Line Road Jackson Mississippi
13 Multifamily 2010 Sherwood Lake Drive Schererville Indiana
- ------------------------------------------------------------------------------------------------------------------------------------
14 Multifamily
14a Multifamily 908-201 Summit Lake Drive Charlotte North Carolina
14b Multifamily 3111-101 Longmeadow Court Raleigh North Carolina
14c Multifamily 500-103 Bridleridge Drive Raleigh North Carolina
- ------------------------------------------------------------------------------------------------------------------------------------
15 Industrial
15a Industrial 215 SE 10th Avenue Hialeah Florida
15b Industrial 615 Stonehill Drive SW Atlanta Georgia
15c Industrial 1433 Massaro Boulevard Tampa Florida
15d Industrial 350 Central Florida Parkway Orlando Florida
15e Industrial 3915 Beryl Road Raleigh North Carolina
- ------------------------------------------------------------------------------------------------------------------------------------
16 Lodging 250 Market Street Portsmouth New Hampshire
17 Anchored Retail 3000-3150 South Hulen Street Fort Worth Texas
18 Multifamily 3636 Mission Drive Indianapolis Indiana
19 Industrial 107 Tom Starling Road Fayetteville North Carolina
20 Office 5165 Emerald Parkway Dublin Ohio
- ------------------------------------------------------------------------------------------------------------------------------------
21 Multifamily 602 Anderson Circle Deerfield Beach Florida
22 Industrial 1300 North Fiesta Boulevard Gilbert Arizona
23 Industrial
23a Industrial 1500 W. Hampden Avenue Sheridan Colorado
23b Industrial 300 E. Mineral & 8000 S. Lincoln Avenue Littleton Colorado
- ------------------------------------------------------------------------------------------------------------------------------------
24 Multifamily 5999 Bear Creek Drive Bedford Ohio
25 Office 3200 Wilshire Boulevard Los Angeles California
26 Lodging 35 Lockwood Drive Charleston South Carolina
27 Retail 6959 Arapaho Road Dallas Texas
28 Office 17855 Dallas Parkway Dallas Texas
- ------------------------------------------------------------------------------------------------------------------------------------
29 Anchored Retail 1301 Custer Road Plano Texas
30 Office 4201 Wilshire Boulevard Los Angeles California
31 Lodging 12725 Center Court Drive Cerritos California
32 Multifamily 1501 Harvey Road College Station Texas
33 Office 1814 Franklin Street Oakland California
- ------------------------------------------------------------------------------------------------------------------------------------
34 Anchored Retail 3254 Pierce Street Richmond California
35 Multifamily
35a Multifamily 1502 East Lindsay Street Norman Oklahoma
35b Multifamily 4119 West Main Street Norman Oklahoma
36 Office 40 Corporate Center St. Louis Missouri
- ------------------------------------------------------------------------------------------------------------------------------------
37 Office 720-740 Milpitas Blvd. & 591-593 Yosemite Blvd. Milpitas California
38 Lodging 250 Foxborough Boulevard Foxborough Massachusetts
39 Retail 2650 Jamacha Road El Cajon California
40 Office 50 Cragwood Road South Plainfield New Jersey
41 Office 323 Lakeside Avenue Cleveland Ohio
- ------------------------------------------------------------------------------------------------------------------------------------
42 Office 10 South Brentwood Boulevard Clayton Missouri
43 Retail 576-578 Fifth Avenue New York New York
44 Office 1930 Century Park West Los Angeles California
45 Multifamily 1200 Broadmoor Drive Austin Texas
46 Office 9350 Flair Drive El Monte California
- ------------------------------------------------------------------------------------------------------------------------------------
47 Industrial 231 Elm Street Perth Amboy New Jersey
48 Multifamily 2415 Old St. Augustine Road Tallahassee Florida
49 Industrial 1650 and 1654 Williams Road Columbus Ohio
50 Anchored Retail 805, 855, 877 Northeast Alsburard Blvd Burleson Texas
51 Office 650 South Grand Avenue Los Angeles California
- ------------------------------------------------------------------------------------------------------------------------------------
52 Anchored Retail 2334 West Buckingham Road Garland Texas
53 Office 3300 - 3320 Truxtun Avenue Bakersfield California
54 Lodging 4235 West Airport Freeway Irving Texas
55 Anchored Retail 200 Hamakuas Drive Kailua Hawaii
56 Lodging 7275 North Port Washington Road Glendale Wisconsin
- ------------------------------------------------------------------------------------------------------------------------------------
57 Multifamily 16900 Algonquin Street Huntington Beach California
58 Office 2525 Bay Area Boulevard Clear Lake Texas
59 Industrial 4310 & 4336 Losee Road North Las Vegas Nevada
60 Multifamily 200 North Festival Drive El Paso Texas
- ------------------------------------------------------------------------------------------------------------------------------------
61 Multifamily
61a Multifamily 35-18 95th Street Jackson Heights New York
61b Multifamily 35-24 95th Street Jackson Heights New York
61c Multifamily 35-38 95th Street Jackson Heights New York
61d Multifamily 35-44 95th Street Jackson Heights New York
61e Multifamily 93-35 Lamont Avenue Elmhurst New York
- ------------------------------------------------------------------------------------------------------------------------------------
62 Multifamily 1110-1120 Beacon Street Brookline Massachusetts
63 Anchored Retail 1332 S. Plano Road Richardson Texas
64 Multifamily 982 West Brevard Street Tallahassee Florida
65 Industrial 14650 Miller Avenue Fontana California
66 Office 42501 Albrae Street & 42808-42840 Christy Street Fremont California
- ------------------------------------------------------------------------------------------------------------------------------------
67 Multifamily 15801 Chase Hill Boulevard San Antonio Texas
68 Office 117 South 17th Street Philadelphia Pennsylvania
69 Retail 796 Gallatin Pike Road Nashville Tennessee
70 Multifamily 43223 & 43230 Gadsden Avenue Lancaster California
71 Multifamily 100 McQueen Smith Road South Prattville Alabama
- ------------------------------------------------------------------------------------------------------------------------------------
72 Office 10005 & 10015 Old Columbia Columbia Maryland
73 Anchored Retail 2944 Boca Chica Boulevard Brownsville Texas
74 Anchored Retail 251 North Broadway Pennsville New Jersey
- ------------------------------------------------------------------------------------------------------------------------------------
75 Multifamily
75a Multifamily 4645 Dudley Street Lincoln Nebraska
75b Multifamily 3636 North 52nd Street Lincoln Nebraska
75c Multifamily 2101 D Street Lincoln Nebraska
75d Multifamily 1215 Arapahoe Street Lincoln Nebraska
75f Multifamily 1215 Arapahoe Street Lincoln Nebraska
- ------------------------------------------------------------------------------------------------------------------------------------
76 Multifamily 7575 Bissonet Boulevard Houston Texas
77 Industrial 525-580 Kennedy Road Tallmadge (Akron) Ohio
78 Anchored Retail 1004-1060 Avenue J Lancaster California
79 Office 761 Corporate Center Drive Pomona California
80 Multifamily 1149 & 1029 East Brooks Street Norman Oklahoma
- ------------------------------------------------------------------------------------------------------------------------------------
81 Office 9888 Carroll Centre Road San Diego California
82 Retail 610 DuBois Street San Rafael California
83 Multifamily 314 East 24th Street Chester Pennsylvania
84 Special Purpose 1412-1416 East Cary Street Richmond Virginia
85 Anchored Retail 901-R West Broad Street (Route250) Waynesboro Virginia
- ------------------------------------------------------------------------------------------------------------------------------------
86 Multifamily 2655 Brighton Henrietta Town Line Road Henrietta New York
87 Retail 1309 West Fairmont Parkway LaPorte Texas
88 Office 5900 Princess Garden Parkway Lanham Maryland
89 Multifamily 7777 McCallum Boulevard Dallas Texas
90 Anchored Retail 725-751 Bustleton Pike Feasterville Pennsylvania
- ------------------------------------------------------------------------------------------------------------------------------------
91 Retail 900 Bugg Lane San Marcos Texas
92 Multifamily 1878 Simonton Road Statesville North Carolina
93 Retail 12845 Poway Road Poway California
94 Retail 10110 U.S. Highway 19 Port Richey Florida
95 Self-Storage 1050 Ridge Road and 100 Hickman Road Claymont Delaware
- ------------------------------------------------------------------------------------------------------------------------------------
96 Office 2500-2522 McKinney Avenue & 2412-2418 Fairmont Street Dallas Texas
97 Industrial 4715-4774 N.W. 157th Street Miami Florida
98 Office 1220 La Venta Drive Westlake Village California
99 Office 2900 East Camelback Road Phoenix Arizona
100 Office 1000 N. Central Avenue Glendale California
- ------------------------------------------------------------------------------------------------------------------------------------
101 Industrial 14920 South San Pedro Street Gardena California
102 Office 420 Columbus Avenue Mt. Pleasant New York
103 Multifamily 525 Lines Drive Albany Georgia
104 Office 202 North Ninth Street Boise Idaho
105 Multifamily Willowcreek Road & Interstate 80/90 Portage Indiana
- ------------------------------------------------------------------------------------------------------------------------------------
106 Multifamily 1702 Bushman Drive Kansas City Missouri
107 Anchored Retail Hwy. 100 and Chester Road Fairview Tennessee
108 Office 100 Morris Avenue Springfield New Jersey
109 Mobile Home Park 1900 Strasbourg Lane Antioch California
110 Multifamily 7625 North 19th Avenue Phoenix Arizona
- ------------------------------------------------------------------------------------------------------------------------------------
111 Office 2835/2860 Exchange Blvd. & 2805 Market Southlake Texas
112 Multifamily 1267-1299 Burnside Avenue and 5-52 Racebrook Drive East Hartford Connecticut
113 Multifamily 605 Cain Ridge Road Vicksburg Mississippi
114 Multifamily 37-59 Charter Oak Street Manchester Connecticut
115 Retail 1100 East Pleasant Run Road DeSoto Texas
- ------------------------------------------------------------------------------------------------------------------------------------
116 Retail 305 East Market Street Leesburg Virginia
117 Mobile Home Park Sandpiper Drive Eustis Florida
118 Multifamily 5005 Tequesquite Avenue Riverside California
119 Industrial
119a Industrial 2 Andrews Drive West Paterson New Jersey
119b Industrial 4 Andrews Drive West Paterson New Jersey
- ------------------------------------------------------------------------------------------------------------------------------------
120 Lodging 9104 Keystone Crossing Indianapolis Indiana
121 Industrial 47-16 Austell Place Long Island City New York
122 Retail 7332 West Colonial Drive Orlando Florida
123 Multifamily 9010 Magnetic Street El Paso Texas
124 Office 75-5706 Hanama Place Kailua Kona Hawaii
125 Multifamily 2801 Westridge Circle Bryan-College Station Texas
- ------------------------------------------------------------------------------------------------------------------------------------
126 Retail 1141-1143 Santee Street Los Angeles California
127 Mixed Use 11600 Manchaca Road Austin Texas
128 Retail 19 North Central Avenue Baltimore Maryland
129 Office 11011 S. 48th Street Phoenix Arizona
130 Mixed Use 4444 Westgrove Drive Addison Texas
- ------------------------------------------------------------------------------------------------------------------------------------
131 Retail 4751 White Lane Bakersfield California
132 Multifamily 3751 Martin Luther King Jr. Drive Atlanta Georgia
133 Industrial 331-341 North Dawson Drive Camarillo California
134 Industrial 228 Lackawana Avenue West Paterson New Jersey
135 Retail 718 North Lake Avenue Pasadena California
- ------------------------------------------------------------------------------------------------------------------------------------
136 Multifamily 525-535 Pontiac Street Oxford Michigan
137 Retail 1711 East End Boulevard North Marshall Texas
138 Multifamily 13400 Victory Boulevard Valley Glen California
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
% OF AGGREGATE
CROSS COLLATERALIZED ORIGINAL CUT-OFF INITIAL
CONTROL NUMBER ZIP CODE GROUPS RELATED GROUPS BALANCE ($) DATE BALANCE ($) POOL BALANCE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1 85016 80,000,000 80,000,000 6.94
2 14304 63,000,000 62,835,426 5.45
- ------------------------------------------------------------------------------------------------------------------------------------
3 Group A Group 1 46,590,000 46,511,317 4.04
3a 66211
3b 43235
3c 38133
3d 23060
3e 66212
3f 64153
3g 38119
3h 75080
3I 26505
3j 85026
3k 45241
3l 78230
3m 85710
3n 55121
3o 07724
3p 97232
3q 48167
3r 08543
- ------------------------------------------------------------------------------------------------------------------------------------
4 91103 42,670,000 42,628,093 3.70
5 95113 34,000,000 33,640,510 2.92
6 46204 29,000,000 28,955,362 2.51
7 10038 28,500,000 28,500,000 2.47
- ------------------------------------------------------------------------------------------------------------------------------------
8 77012 27,000,000 26,926,701 2.34
8a 77012
8b 77071
8c 77477
8d 77035
- ------------------------------------------------------------------------------------------------------------------------------------
9 91406 26,000,000 25,984,904 2.26
10 24,905,460 24,888,157 2.16
10a 48642
10b 60137
10c 48642
- ------------------------------------------------------------------------------------------------------------------------------------
11 10036 23,000,000 23,000,000 2.00
12 39211 Group 2 21,000,000 20,990,264 1.82
13 46375 20,500,000 20,162,442 1.75
- ------------------------------------------------------------------------------------------------------------------------------------
14 Group 3 18,000,000 17,950,331 1.56
14a 28270
14b 27613
14c 27609
- ------------------------------------------------------------------------------------------------------------------------------------
15 17,420,000 17,420,000 1.51
15a 33010
15b 30336
15c 33619
15d 32824
15e 27607
- ------------------------------------------------------------------------------------------------------------------------------------
16 03801 16,000,000 15,949,087 1.38
17 76109 Group 2 15,250,000 15,242,981 1.32
18 46224 15,015,000 14,993,950 1.30
19 28348 14,500,000 14,493,350 1.26
20 43017 14,000,000 13,992,523 1.21
- ------------------------------------------------------------------------------------------------------------------------------------
21 33441 13,600,000 13,591,754 1.18
22 85233 Group 4 13,130,000 13,123,184 1.14
23 12,450,000 12,427,897 1.08
23a 80110
23b 80121
- ------------------------------------------------------------------------------------------------------------------------------------
24 44146 12,250,000 12,231,790 1.06
25 90010 Group 5 12,000,000 11,850,637 1.03
26 29401 11,200,000 11,191,325 0.97
27 75248 Group 6 10,915,000 10,906,598 0.95
28 75287 10,875,000 10,875,000 0.94
- ------------------------------------------------------------------------------------------------------------------------------------
29 75075 Group 6 10,250,000 10,245,780 0.89
30 90010 Group 5 10,200,000 10,104,511 0.88
31 90703 10,000,000 9,992,305 0.87
32 77840 9,450,000 9,441,145 0.82
33 94612 9,500,000 9,404,424 0.82
- ------------------------------------------------------------------------------------------------------------------------------------
34 94804 9,300,000 9,296,027 0.81
35 9,250,000 9,231,694 0.80
35a 73071
35b 73072
36 63141 Group 7 8,850,000 8,850,000 0.77
- ------------------------------------------------------------------------------------------------------------------------------------
37 95035 8,800,000 8,783,056 0.76
38 02035 8,100,000 8,093,378 0.70
39 92019 7,800,000 7,788,279 0.68
40 07080 7,500,000 7,496,174 0.65
41 44113 7,450,000 7,435,324 0.65
- ------------------------------------------------------------------------------------------------------------------------------------
42 63105 Group 7 7,425,000 7,425,000 0.64
43 10036 7,400,000 7,386,955 0.64
44 90067 7,400,000 7,386,236 0.64
45 78723 7,350,000 7,342,525 0.64
46 91731 7,200,000 7,103,566 0.62
- ------------------------------------------------------------------------------------------------------------------------------------
47 08861 7,000,000 6,994,302 0.61
48 32301 7,000,000 6,986,655 0.61
49 43207 6,985,000 6,970,891 0.61
50 76028 Group 6 6,600,000 6,597,660 0.57
51 90017 6,600,000 6,581,073 0.57
- ------------------------------------------------------------------------------------------------------------------------------------
52 75042 6,575,000 6,571,707 0.57
53 93301 Group 8 6,400,000 6,309,519 0.55
54 75062 6,100,000 6,095,275 0.53
55 96734 6,100,000 6,097,421 0.53
56 53217 6,100,000 6,082,695 0.53
- ------------------------------------------------------------------------------------------------------------------------------------
57 92649 6,035,000 6,028,410 0.52
58 77060 6,000,000 5,997,104 0.52
59 89030 5,940,000 5,937,441 0.52
60 79912 5,800,000 5,797,463 0.50
- ------------------------------------------------------------------------------------------------------------------------------------
61 5,750,000 5,717,627 0.50
61a 11372
61b 11372
61c 11372
61d 11372
61e 11372
- ------------------------------------------------------------------------------------------------------------------------------------
62 02146 5,700,000 5,697,357 0.49
63 75081 Group 2 5,600,000 5,597,376 0.49
64 32304 5,200,000 5,197,262 0.45
65 92336 5,000,000 4,993,661 0.43
66 94538 5,000,000 4,983,637 0.43
- ------------------------------------------------------------------------------------------------------------------------------------
67 78256 5,000,000 4,986,042 0.43
68 19103 4,970,000 4,962,688 0.43
69 37115 5,000,000 4,919,468 0.43
70 93534 5,000,000 4,913,515 0.43
71 36066 4,900,000 4,894,842 0.42
- ------------------------------------------------------------------------------------------------------------------------------------
72 21046 4,828,705 4,821,449 0.42
73 78521 4,800,000 4,796,080 0.42
74 08070 Group 3 4,800,000 4,793,770 0.42
- ------------------------------------------------------------------------------------------------------------------------------------
75 4,741,471 4,673,453 0.41
75a 68503
75b 68504
75c 68502
75d 68502
75f 68502
- ------------------------------------------------------------------------------------------------------------------------------------
76 77074 4,500,000 4,492,352 0.39
77 44305 4,352,000 4,352,000 0.38
78 93535 4,290,000 4,282,853 0.37
79 91768 4,245,000 4,237,947 0.37
80 73072 4,059,000 4,057,037 0.35
- ------------------------------------------------------------------------------------------------------------------------------------
81 92126 4,041,000 4,039,173 0.35
82 94901 4,040,000 4,034,290 0.35
83 19013 4,000,000 3,956,022 0.34
84 23298 3,900,000 3,896,785 0.34
85 22980 3,800,000 3,787,788 0.33
- ------------------------------------------------------------------------------------------------------------------------------------
86 14623 3,740,000 3,738,431 0.32
87 77571 3,575,000 3,568,623 0.31
88 20706 3,500,000 3,498,503 0.30
89 75252 3,485,000 3,482,154 0.30
90 19053 3,421,000 3,415,813 0.30
- ------------------------------------------------------------------------------------------------------------------------------------
91 78666 3,375,000 3,372,925 0.29
92 28677 3,350,000 3,343,732 0.29
93 92064 3,300,000 3,290,953 0.29
94 34653 3,255,000 3,251,878 0.28
95 19703 3,250,000 3,240,153 0.28
- ------------------------------------------------------------------------------------------------------------------------------------
96 75201 3,230,000 3,224,333 0.28
97 33167 3,150,000 3,145,195 0.27
98 91360 Group 9 3,150,000 3,144,226 0.27
99 85016 3,130,000 3,128,485 0.27
100 91203 3,100,000 3,098,649 0.27
- ------------------------------------------------------------------------------------------------------------------------------------
101 90248 Group 4 3,000,000 2,998,500 0.26
102 10595 2,775,000 2,766,141 0.24
103 31705 2,750,000 2,744,979 0.24
104 83702 2,655,000 2,653,725 0.23
105 46368 2,600,000 2,595,005 0.23
- ------------------------------------------------------------------------------------------------------------------------------------
106 64110 2,560,000 2,555,385 0.22
107 37062 2,490,000 2,485,454 0.22
108 07081 2,460,000 2,457,696 0.21
109 94509 2,375,000 2,369,765 0.21
110 85021 2,260,000 2,253,950 0.20
- ------------------------------------------------------------------------------------------------------------------------------------
111 76092 2,190,000 2,189,098 0.19
112 06108 2,080,000 2,077,860 0.18
113 39180 2,080,000 2,077,600 0.18
114 06040 2,050,000 2,046,062 0.18
115 75115 2,025,000 2,024,303 0.18
- ------------------------------------------------------------------------------------------------------------------------------------
116 20176 2,000,000 1,995,846 0.17
117 37802 2,000,000 1,986,424 0.17
118 92501 1,960,000 1,958,977 0.17
119 Group 10 1,950,000 1,937,568 0.17
119a 07424
119b 07424
- ------------------------------------------------------------------------------------------------------------------------------------
120 46240 Group A Group 1 1,920,000 1,916,757 0.17
121 11101 1,860,000 1,843,518 0.16
122 32818 1,800,000 1,799,078 0.16
123 79904 1,800,000 1,795,619 0.16
124 96740 1,750,000 1,735,996 0.15
125 77801 1,670,000 1,669,175 0.14
- ------------------------------------------------------------------------------------------------------------------------------------
126 90015 1,650,000 1,648,441 0.14
127 78748 1,623,000 1,620,494 0.14
128 21202 1,465,000 1,451,189 0.13
129 85044 1,450,000 1,437,175 0.12
130 75248 1,440,000 1,433,509 0.12
- ------------------------------------------------------------------------------------------------------------------------------------
131 93309 Group 8 1,375,000 1,363,602 0.12
132 30331 1,325,000 1,324,345 0.11
133 93010 Group 9 1,250,000 1,246,537 0.11
134 07424 Group 10 1,250,000 1,242,031 0.11
135 91104 1,168,000 1,166,996 0.10
- ------------------------------------------------------------------------------------------------------------------------------------
136 48371 1,100,000 1,088,864 0.09
137 75671 1,050,000 1,049,145 0.09
138 91401 870,000 869,138 0.08
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CUMULATIVE % INTEREST
OF INITIAL SERVICING ACCRUAL
CONTROL NUMBER POOL BALANCE MORTGAGE RATE (%) FEE RATE (%) METHOD AMORTIZATION TYPE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1 6.94 7.6800 0.0319 Actual / 360 Interest Only, then Hyper Amortizing
2 12.40 7.6040 0.1269 Actual / 360 Hyper Amortizing
- ------------------------------------------------------------------------------------------------------------------------------------
3 16.44 8.3700 0.1269 Actual / 360 Hyper Amortizing
3a
3b
3c
3d
3e
3f
3g
3h
3I
3j
3k
3l
3m
3n
3o
3p
3q
3r
- ------------------------------------------------------------------------------------------------------------------------------------
4 20.14 8.2900 0.1269 Actual / 360 Hyper Amortizing
5 23.06 7.5500 0.0819 Actual / 360 Balloon
6 25.57 8.0900 0.0819 Actual / 360 Hyper Amortizing
7 28.04 8.1200 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
8 30.38 7.4400 0.1269 Actual / 360 Balloon
8a
8b
8c
8d
- ------------------------------------------------------------------------------------------------------------------------------------
9 32.64 7.6800 0.0519 Actual / 360 Balloon
10 34.80 7.3200 0.0819 Actual / 360 Hyper Amortizing
10a
10b
10c
- ------------------------------------------------------------------------------------------------------------------------------------
11 36.79 7.9900 0.1269 Actual / 360 Interest Only, then Balloon
12 38.62 7.9100 0.1269 Actual / 360 Balloon
13 40.37 6.9850 0.0819 30 / 360 Hyper Amortizing
- ------------------------------------------------------------------------------------------------------------------------------------
14 41.92 7.3700 0.1269 Actual / 360 Balloon
14a
14b
14c
- ------------------------------------------------------------------------------------------------------------------------------------
15 43.44 8.2600 0.1269 Actual / 360 Interest Only, then Balloon
15a
15b
15c
15d
15e
- ------------------------------------------------------------------------------------------------------------------------------------
16 44.82 8.5290 0.0819 Actual / 360 Balloon
17 46.14 7.9300 0.1269 Actual / 360 Balloon
18 47.45 7.8000 0.0819 30 / 360 Hyper Amortizing
19 48.70 8.5000 0.1269 Actual / 360 Balloon
20 49.92 7.9800 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
21 51.10 7.5200 0.1269 Actual / 360 Balloon
22 52.24 8.0800 0.1269 Actual / 360 Balloon
23 53.32 8.1300 0.1269 Actual / 360 Balloon
23a
23b
- ------------------------------------------------------------------------------------------------------------------------------------
24 54.38 8.2800 0.1269 Actual / 360 Balloon
25 55.41 7.1500 0.0819 30 / 360 Hyper Amortizing
26 56.38 8.7500 0.1269 Actual / 360 Hyper Amortizing
27 57.32 8.4100 0.1269 Actual / 360 Balloon
28 58.27 7.5400 0.1269 Actual / 360 Interest Only
- ------------------------------------------------------------------------------------------------------------------------------------
29 59.16 8.2300 0.1269 Actual / 360 Balloon
30 60.03 6.8400 0.0819 Actual / 360 Hyper Amortizing
31 60.90 8.7800 0.1269 Actual / 360 Hyper Amortizing
32 61.72 7.8900 0.1269 Actual / 360 Balloon
33 62.54 7.0500 0.0819 30 / 360 Hyper Amortizing
- ------------------------------------------------------------------------------------------------------------------------------------
34 63.34 8.7300 0.1269 Actual / 360 Balloon
35 64.15 7.6600 0.1269 Actual / 360 Balloon
35a
35b
36 64.91 7.9600 0.1269 Actual / 360 Interest Only, then Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
37 65.68 7.7800 0.1269 Actual / 360 Balloon
38 66.38 8.5000 0.1269 Actual / 360 Hyper Amortizing
39 67.06 8.1700 0.0819 Actual / 360 Balloon
40 67.71 8.1400 0.1269 Actual / 360 Balloon
41 68.35 8.1100 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
42 69.00 7.9600 0.1269 Actual / 360 Interest Only, then Balloon
43 69.64 8.1600 0.1269 Actual / 360 Balloon
44 70.28 7.9300 0.1269 Actual / 360 Balloon
45 70.92 8.1700 0.1269 Actual / 360 Balloon
46 71.53 7.1200 0.0819 30 / 360 Hyper Amortizing
- ------------------------------------------------------------------------------------------------------------------------------------
47 72.14 8.5200 0.1269 Actual / 360 Balloon
48 72.75 7.7800 0.1269 Actual / 360 Balloon
49 73.35 7.5700 0.1269 Actual / 360 Balloon
50 73.92 8.6000 0.1269 Actual / 360 Balloon
51 74.50 8.1900 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
52 75.07 7.6900 0.1269 Actual / 360 Balloon
53 75.61 7.1700 0.0819 30 / 360 Hyper Amortizing
54 76.14 8.7500 0.1269 Actual / 360 Hyper Amortizing
55 76.67 8.1600 0.1269 Actual / 360 Balloon
56 77.20 8.2500 0.1269 Actual / 360 Hyper Amortizing
- ------------------------------------------------------------------------------------------------------------------------------------
57 77.72 7.9200 0.1269 Actual / 360 Balloon
58 78.24 8.3300 0.1269 Actual / 360 Balloon
59 78.76 8.1100 0.1269 Actual / 360 Balloon
60 79.26 8.0700 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
61 79.76 7.9000 0.0819 Actual / 360 Balloon
61a
61b
61c
61d
61e
- ------------------------------------------------------------------------------------------------------------------------------------
62 80.25 7.9100 0.1269 Actual / 360 Balloon
63 80.74 7.8800 0.1269 Actual / 360 Balloon
64 81.19 8.0300 0.1269 Actual / 360 Balloon
65 81.62 7.3700 0.1269 Actual / 360 Balloon
66 82.06 7.6500 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
67 82.49 7.3200 0.1269 Actual / 360 Balloon
68 82.92 7.5600 0.0819 30 / 360 Hyper Amortizing
69 83.35 7.5850 0.0819 Actual / 360 Balloon
70 83.77 6.7500 0.1269 Actual / 360 Balloon
71 84.20 8.0500 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
72 84.62 8.1700 0.2269 Actual / 360 Balloon
73 85.03 8.2600 0.1269 Actual / 360 Balloon
74 85.45 7.2800 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
75 85.85 6.7600 0.0819 30 / 360 Balloon
75a
75b
75c
75d
75f
- ------------------------------------------------------------------------------------------------------------------------------------
76 86.24 7.7500 0.1319 Actual / 360 Balloon
77 86.62 8.4100 0.2269 Actual / 360 Balloon
78 86.99 7.8200 0.1269 Actual / 360 Balloon
79 87.36 8.4100 0.1269 Actual / 360 Balloon
80 87.71 7.7900 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
81 88.06 7.9800 0.1269 Actual / 360 Balloon
82 88.42 8.3700 0.0819 Actual / 360 Balloon
83 88.76 7.0200 0.0819 30 / 360 Hyper Amortizing
84 89.10 8.4600 0.1269 Actual / 360 Balloon
85 89.43 7.5500 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
86 89.75 8.1800 0.1269 Actual / 360 Balloon
87 90.06 8.1100 0.1269 Actual / 360 Balloon
88 90.36 8.1300 0.1269 Actual / 360 Balloon
89 90.67 8.2600 0.1269 Actual / 360 Balloon
90 90.96 8.3800 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
91 91.26 8.9300 0.1269 Actual / 360 Balloon
92 91.55 7.7900 0.0819 Actual / 360 Balloon
93 91.83 8.5000 0.1219 Actual / 360 Balloon
94 92.11 8.3700 0.1269 Actual / 360 Balloon
95 92.39 7.4900 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
96 92.67 8.1800 0.1269 Actual / 360 Balloon
97 92.95 8.1200 0.0819 Actual / 360 Balloon
98 93.22 7.4800 0.0819 Actual / 360 Balloon
99 93.49 8.3200 0.1269 Actual / 360 Balloon
100 93.76 8.0800 0.1319 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
101 94.02 8.2100 0.1269 Actual / 360 Balloon
102 94.26 8.0000 0.0819 Actual / 360 Hyper Amortizing
103 94.50 8.0100 0.1269 Actual / 360 Balloon
104 94.73 7.8100 0.1269 Actual / 360 Balloon
105 94.96 7.7900 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
106 95.18 7.5400 0.1269 Actual / 360 Balloon
107 95.39 8.0100 0.1269 Actual / 360 Balloon
108 95.61 8.4500 0.1269 Actual / 360 Balloon
109 95.81 7.1800 0.1269 Actual / 360 Balloon
110 96.01 7.5000 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
111 96.20 8.2300 0.1269 Actual / 360 Balloon
112 96.38 8.1300 0.1269 Actual / 360 Balloon
113 96.56 7.7200 0.1269 Actual / 360 Balloon
114 96.74 7.7900 0.1269 Actual / 360 Balloon
115 96.91 8.6700 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
116 97.08 7.9400 0.0819 Actual / 360 Balloon
117 97.26 7.5000 0.0819 Actual / 360 Hyper Amortizing
118 97.43 8.0600 0.1269 Actual / 360 Balloon
119 97.60 7.2800 0.0819 Actual / 360 Balloon
119a
119b
- ------------------------------------------------------------------------------------------------------------------------------------
120 97.76 8.3700 0.1269 Actual / 360 Hyper Amortizing
121 97.92 7.8200 0.0819 30 / 360 Hyper Amortizing
122 98.08 8.1250 0.1269 Actual / 360 Balloon
123 98.23 7.9000 0.1269 Actual / 360 Balloon
124 98.38 6.7000 0.0819 30 / 360 Hyper Amortizing
125 98.53 8.2500 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
126 98.67 8.4200 0.1269 Actual / 360 Balloon
127 98.81 8.0800 0.1269 Actual / 360 Balloon
128 98.94 7.7200 0.1269 Actual / 360 Fully Amortizing
129 99.06 7.2500 0.0819 30 / 360 Hyper Amortizing
130 99.19 8.1600 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
131 99.31 7.4300 0.0819 Actual / 360 Hyper Amortizing
132 99.42 8.2500 0.1269 Actual / 360 Balloon
133 99.53 7.9300 0.0819 Actual / 360 Balloon
134 99.64 7.2800 0.0819 Actual / 360 Balloon
135 99.74 8.7300 0.1269 Actual / 360 Balloon
- ------------------------------------------------------------------------------------------------------------------------------------
136 99.83 7.2500 0.0819 Actual / 360 Hyper Amortizing
137 99.92 8.5200 0.1269 Actual / 360 Balloon
138 100.00 8.2600 0.1269 Actual / 360 Balloon
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ORIGINAL
ORIGINAL INTEREST REMAINING TERM TO ORIGINAL REMAINING
ONLY PERIOD INTEREST ONLY MATURITY REMAINING TERM AMORTIZATION AMORTIZATION
CONTROL NUMBER (MOS.) PERIOD (MOS.) (MOS.) TO MATURITY (MOS.) TERM (MOS.) TERM (MOS.)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1 12 10 120 118 360 360
2 0 120 116 360 356
- ----------------------------------------------------------------------------------------------------------------------------------
3 0 120 118 300 298
3a
3b
3c
3d
3e
3f
3g
3h
3I
3j
3k
3l
3m
3n
3o
3p
3q
3r
- ----------------------------------------------------------------------------------------------------------------------------------
4 0 120 118 360 358
5 0 120 104 360 344
6 0 120 117 360 357
7 0 120 120 360 360
- ----------------------------------------------------------------------------------------------------------------------------------
8 0 120 116 360 356
8a
8b
8c
8d
- ----------------------------------------------------------------------------------------------------------------------------------
9 0 120 119 360 359
10 0 120 119 338 337
10a
10b
10c
- ----------------------------------------------------------------------------------------------------------------------------------
11 47 47 119 119 360 360
12 0 120 119 360 359
13 0 120 101 360 341
- ----------------------------------------------------------------------------------------------------------------------------------
14 0 120 116 360 356
14a
14b
14c
- ----------------------------------------------------------------------------------------------------------------------------------
15 24 21 120 117 360 360
15a
15b
15c
15d
15e
- ----------------------------------------------------------------------------------------------------------------------------------
16 0 120 116 300 296
17 0 120 119 360 359
18 0 99 97 360 358
19 0 120 119 360 359
20 0 120 119 360 359
- ----------------------------------------------------------------------------------------------------------------------------------
21 0 120 119 360 359
22 0 120 119 360 359
23 0 120 117 360 357
23a
23b
- ----------------------------------------------------------------------------------------------------------------------------------
24 0 180 179 240 239
25 0 120 105 360 345
26 0 84 83 300 299
27 0 120 118 360 358
28 120 119 120 119 0 0
- ----------------------------------------------------------------------------------------------------------------------------------
29 0 120 119 360 359
30 0 120 109 348 337
31 0 120 119 300 299
32 0 120 118 360 358
33 0 120 108 360 348
- ----------------------------------------------------------------------------------------------------------------------------------
34 0 180 179 360 359
35 0 120 117 360 357
35a
35b
36 24 23 120 119 360 360
- ----------------------------------------------------------------------------------------------------------------------------------
37 0 120 117 360 357
38 0 120 119 300 299
39 0 120 117 360 357
40 0 120 119 360 359
41 0 120 116 360 356
- ----------------------------------------------------------------------------------------------------------------------------------
42 24 23 120 119 360 360
43 0 120 117 360 357
44 0 120 117 360 357
45 0 120 118 360 358
46 0 120 104 360 344
- ----------------------------------------------------------------------------------------------------------------------------------
47 0 120 119 300 299
48 0 120 118 300 298
49 0 120 117 360 357
50 0 180 179 360 359
51 0 120 117 300 297
- ----------------------------------------------------------------------------------------------------------------------------------
52 0 120 119 360 359
53 0 121 104 360 343
54 0 120 119 300 299
55 0 120 119 360 359
56 0 83 80 300 297
- ----------------------------------------------------------------------------------------------------------------------------------
57 0 120 118 360 358
58 0 120 119 360 359
59 0 120 119 360 359
60 0 120 119 360 359
- ----------------------------------------------------------------------------------------------------------------------------------
61 0 120 114 300 294
61a
61b
61c
61d
61e
- ----------------------------------------------------------------------------------------------------------------------------------
62 0 120 119 360 359
63 0 120 119 360 359
64 0 120 119 360 359
65 0 120 118 360 358
66 0 120 118 240 238
- ----------------------------------------------------------------------------------------------------------------------------------
67 0 120 116 360 356
68 0 120 118 360 358
69 0 120 105 300 285
70 0 120 106 300 286
71 0 120 118 360 358
- ----------------------------------------------------------------------------------------------------------------------------------
72 0 120 117 360 357
73 0 120 118 360 358
74 0 120 118 360 358
- ----------------------------------------------------------------------------------------------------------------------------------
75 0 120 104 360 344
75a
75b
75c
75d
75f
- ----------------------------------------------------------------------------------------------------------------------------------
76 0 120 117 360 357
77 0 120 120 360 360
78 0 120 117 360 357
79 0 120 117 360 357
80 0 120 119 360 359
- ----------------------------------------------------------------------------------------------------------------------------------
81 0 120 119 360 359
82 0 120 117 360 357
83 0 120 107 360 347
84 0 120 119 300 299
85 0 120 117 300 297
- ----------------------------------------------------------------------------------------------------------------------------------
86 0 120 119 360 359
87 0 120 117 360 357
88 0 120 119 360 359
89 0 120 118 360 358
90 0 120 118 300 298
- ----------------------------------------------------------------------------------------------------------------------------------
91 0 120 118 360 358
92 0 120 117 348 345
93 0 120 114 360 354
94 0 120 118 360 358
95 0 120 117 300 297
- ----------------------------------------------------------------------------------------------------------------------------------
96 0 120 117 360 357
97 0 120 117 360 357
98 0 120 117 360 357
99 0 120 119 360 359
100 0 120 119 360 359
- ----------------------------------------------------------------------------------------------------------------------------------
101 0 120 119 360 359
102 0 120 114 360 354
103 0 180 177 360 357
104 0 120 119 360 359
105 0 120 117 360 357
- ----------------------------------------------------------------------------------------------------------------------------------
106 0 120 117 360 357
107 0 120 117 360 357
108 0 120 118 360 358
109 0 120 117 360 357
110 0 120 116 360 356
- ----------------------------------------------------------------------------------------------------------------------------------
111 0 120 119 360 359
112 0 120 118 360 358
113 0 120 118 360 358
114 0 120 117 360 357
115 0 120 119 360 359
- ----------------------------------------------------------------------------------------------------------------------------------
116 0 120 116 360 356
117 0 120 110 360 350
118 0 120 119 360 359
119 0 120 114 300 294
119a
119b
- ----------------------------------------------------------------------------------------------------------------------------------
120 0 120 118 300 298
121 0 120 112 300 292
122 0 132 131 360 359
123 0 120 116 360 356
124 0 119 110 360 351
125 0 120 119 360 359
- ----------------------------------------------------------------------------------------------------------------------------------
126 0 120 118 360 358
127 0 120 117 360 357
128 0 202 198 202 198
129 0 120 109 360 349
130 0 120 115 300 295
- ----------------------------------------------------------------------------------------------------------------------------------
131 0 120 108 360 348
132 0 120 119 360 359
133 0 120 117 300 297
134 0 120 114 300 294
135 0 120 118 360 358
- ----------------------------------------------------------------------------------------------------------------------------------
136 0 120 111 300 291
137 0 120 119 300 299
138 0 120 118 360 358
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ORIGINATION MATURITY DATE BALLOON OR MONTHLY UNDERWRITTEN NET
CONTROL NUMBER DATE OR ARD ARD BALANCE ($) PREPAYMENT PROVISION PAYMENT ($) CASH FLOW ($)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1 6/16/99 7/10/09 71,272,907 Lock/26_Defeasance/90_0%/4 575,491.93 9,894,954
2 4/27/99 5/10/09 54,942,475 Lock/28_Defeasance/85_0%/7 449,922.94 7,361,978
- ------------------------------------------------------------------------------------------------------------------------------------
3 6/16/99 7/1/09 38,094,187 Lock/35_Defeasance/81_0%/4 374,997.71 8,551,567
3a 329,147
3b 427,069
3c 317,856
3d 496,388
3e 404,571
3f 332,190
3g 436,041
3h 286,046
3I 371,687
3j 653,874
3k 304,815
3l 380,295
3m 489,469
3n 596,340
3o 431,523
3p 971,638
3q 407,910
3r 914,713
- ------------------------------------------------------------------------------------------------------------------------------------
4 6/17/99 7/10/09 37,746,005 Lock/26_Defeasance/90_0%/4 325,483.48 4,887,329
5 4/30/98 5/1/08 30,086,430 Lock/48_>YM or 1%/68_0%/4 238,898.09 4,103,369
6 4/21/99 6/1/09 25,999,961 Lock/35_Defeasance/81_0%/4 214,614.01 3,171,370
7 8/2/99 9/1/09 25,563,948 Lock/24_Defeasance/92_0%/4 211,511.95 3,336,012
- ------------------------------------------------------------------------------------------------------------------------------------
8 4/30/99 5/10/09 23,462,062 Lock/28_Defeasance/90_0%/2 189,731.10 3,050,782
8a 2,138,531
8b 436,331
8c 355,370
8d 120,550
- ------------------------------------------------------------------------------------------------------------------------------------
9 7/30/99 8/10/09 22,712,015 Lock/25_Defeasance/91_0%/4 187,042.19 2,783,357
10 7/29/98 8/1/09 21,339,727 Lock/37_Defeasance/76_0%/7 174,290.58 2,488,306
10a 938,425
10b 1,154,380
10c 395,498
- ------------------------------------------------------------------------------------------------------------------------------------
11 7/30/99 8/1/09 21,782,540 Lock/34_Defeasance/81_0%/4 168,605.53 2,563,622
12 7/30/99 8/1/09 18,746,010 Lock/25_Defeasance/91_0%/4 152,775.06 2,185,909
13 1/15/98 2/1/08 17,585,326 Lock/59_Defeasance/54_0%/7 136,180.56 2,158,435
- ------------------------------------------------------------------------------------------------------------------------------------
14 5/3/99 5/10/09 15,616,950 Lock/28_Defeasance/88_0%/4 125,611.11 1,841,138
14a 413,288
14b 779,039
14c 648,811
- ------------------------------------------------------------------------------------------------------------------------------------
15 6/10/99 6/10/09 15,947,938 Lock/27_Defeasance/89_0%/4 132,474.71 1,987,139
15a 943,046
15b 381,433
15c 248,237
15d 227,487
15e 186,936
- ------------------------------------------------------------------------------------------------------------------------------------
16 4/16/99 5/1/09 13,395,118 Lock/28_Defeasance/92_0%/0 129,149.17 1,987,758
17 7/30/99 8/1/09 13,619,741 Lock/25_Defeasance/91_0%/4 111,155.82 1,922,887
18 6/29/99 10/1/07 13,563,729 Lock/26_Defeasance/69_0%/4 108,088.56 1,659,160
19 7/30/99 8/10/09 12,879,353 Lock/25_Defeasance/95_0%/0 112,782.01 1,810,351
20 7/28/99 8/10/09 12,307,115 Lock/25_Defeasance/93_0%/2 103,680.60 1,489,044
- ------------------------------------------------------------------------------------------------------------------------------------
21 7/26/99 8/10/09 11,838,868 Lock/25_Defeasance/93_0%/2 96,313.61 1,382,941
22 7/30/99 8/10/09 11,566,003 Lock/25_Defeasance/91_0%/4 98,171.15 1,883,664
23 5/27/99 6/1/09 10,978,115 Lock/27_Defeasance/93 93,533.00 1,275,637
23a 1,275,637
23b 0
- ------------------------------------------------------------------------------------------------------------------------------------
24 7/30/99 8/10/14 5,156,523 Lock/25_Defeasance/151_0%/4 105,552.17 1,586,031
25 5/7/98 6/1/08 10,333,532 Lock/47_Defeasance/66_0%/7 81,048.81 1,386,612
26 7/29/99 8/1/06 10,019,142 Lock/26_Defeasance/56_0%/2 93,064.29 1,568,306
27 6/25/99 7/1/09 9,860,722 Lock/26_Defeasance/90_0%/4 83,231.70 1,253,217
28 7/7/99 8/1/09 10,875,000 >YM or 1%/25_Defeasance/91_0%/4 70,608.96 1,612,498
- ------------------------------------------------------------------------------------------------------------------------------------
29 7/2/99 8/1/09 9,219,600 Lock/25_Defeasance/91_0%/4 76,860.75 1,131,315
30 9/15/98 10/1/08 8,741,217 Lock/47_Defeasance/69_0%/4 67,449.92 1,100,970
31 7/30/99 8/1/09 8,257,449 Lock/47_Defeasance/71_0%/2 83,300.91 1,491,479
32 6/7/99 7/1/09 8,433,151 Lock/35_Defeasance/81_0%/4 68,617.47 1,197,178
33 8/5/98 9/1/08 8,161,739 Lock/36_Defeasance/77_0%/7 63,523.07 1,027,351
- ------------------------------------------------------------------------------------------------------------------------------------
34 7/30/99 8/10/14 7,345,614 Lock/25_Defeasance/148_0%/7 73,886.00 1,192,051
35 5/14/99 6/10/09 8,076,744 Lock/27_Defeasance/89_0%/4 66,415.57 951,927
35a 545,410
35b 406,517
36 8/2/99 8/10/09 8,064,667 Lock/25_Defeasance/91_0%/4 65,407.85 942,480
- ------------------------------------------------------------------------------------------------------------------------------------
37 6/1/99 6/10/09 7,703,572 Lock/27_Defeasance/89_0%/4 63,927.32 988,977
38 7/30/99 8/1/09 6,643,979 Lock/47_Defeasance/71_0%/2 65,909.13 1,328,178
39 5/20/99 6/1/09 7,006,305 Lock/27_Defeasance/89_0%/4 58,160.70 834,892
40 7/16/99 8/10/09 6,614,670 Lock/25_Defeasance/88_0%/7 56,397.26 845,391
41 4/26/99 5/1/09 6,683,736 Lock/35_Defeasance/81_0%/4 55,237.82 934,926
- ------------------------------------------------------------------------------------------------------------------------------------
42 8/2/99 8/10/09 6,766,119 Lock/25_Defeasance/91_0%/4 54,876.08 790,480
43 5/13/99 6/10/09 6,529,095 Lock/27_Defeasance/89_0%/4 55,752.38 866,435
44 5/13/99 6/10/09 6,498,443 Lock/27_Defeasance/89_0%/4 54,541.57 852,560
45 6/25/99 7/10/09 6,486,291 Lock/26_Defeasance/90_0%/4 55,433.73 797,200
46 4/9/98 5/1/08 6,195,821 Lock/59_Defeasance/54_0%/7 48,483.44 833,544
- ------------------------------------------------------------------------------------------------------------------------------------
47 7/19/99 8/10/09 5,744,489 Lock/25_Defeasance/91_0%/4 57,054.68 907,599
48 7/1/99 7/10/09 5,638,690 Lock/26_Defeasance/92_0%/2 53,546.17 767,940
49 5/13/99 6/10/09 6,087,132 Lock/27_Defeasance/89_0%/4 49,712.23 1,064,338
50 7/2/99 8/1/14 5,411,295 Lock/25_Defeasance/151_0%/4 51,216.77 769,054
51 5/24/99 6/10/09 5,372,450 Lock/27_Defeasance/89_0%/4 52,307.35 848,009
- ------------------------------------------------------------------------------------------------------------------------------------
52 7/16/99 8/1/09 5,837,845 Lock/25_Defeasance/88_0%7 46,831.79 704,292
53 4/1/98 5/1/08 5,503,389 Lock/59_Defeasance/58_0%/4 43,312.55 677,778
54 7/26/99 8/1/09 5,033,485 Lock/48_Defeasance/70_0%/2 50,686.80 872,283
55 7/23/99 8/1/09 5,477,796 Lock/35_Defeasance/81_0%/4 45,441.88 741,209
56 5/5/99 5/1/06 5,423,977 Lock/47_Defeasance/34_0%/2 48,593.66 845,964
- ------------------------------------------------------------------------------------------------------------------------------------
57 6/11/99 7/10/09 5,298,647 Lock/26_Defeasance/90_0%/4 44,442.42 599,794
58 7/30/99 8/10/09 5,311,810 Lock/25_Defeasance/91_0%/4 45,933.93 658,496
59 7/2/99 8/1/09 5,327,832 Lock/35_Defeasance/81_0%/4 44,041.97 660,515
60 7/7/99 8/1/09 5,197,333 Lock/25_Defeasance/91_0%/4 42,841.72 617,299
- ------------------------------------------------------------------------------------------------------------------------------------
61 2/23/99 3/1/09 4,728,687 Lock/30_Defeasance/86_0%/4 43,999.20 679,687
61a 92,869
61b 74,672
61c 72,830
61d 89,072
61e 350,244
- ------------------------------------------------------------------------------------------------------------------------------------
62 7/30/99 8/1/09 5,088,202 Lock/35_Defeasance/81_0%/4 41,467.52 603,194
63 7/30/99 8/1/09 4,995,313 Lock/25_Defeasance/91_0%/4 40,623.32 654,186
64 7/13/99 8/10/09 4,575,919 Lock/25_Defeasance/91_0%/4 38,694.64 575,479
65 6/17/99 7/10/09 4,338,047 Lock/26_Defeasance/94 34,891.17 479,468
66 6/16/99 7/10/09 3,421,937 Lock/26_Defeasance/90_0%/4 41,092.29 776,898
- ------------------------------------------------------------------------------------------------------------------------------------
67 4/29/99 5/10/09 4,333,162 Lock/28_Defeasance/88_0%/4 34,718.51 516,862
68 2/12/98 7/1/09 4,319,394 Lock/60_Defeasance/56_0%/4 34,955.38 538,488
69 5/8/98 6/1/08 4,072,491 Lock/47_Defeasance/69_0%/4 37,226.45 812,893
70 6/24/98 7/1/08 3,969,539 Lock/60_>1% or YM/53_0%/7 34,545.58 600,721
71 6/25/99 7/10/09 4,313,685 Lock/26_Defeasance/90_0%/4 36,536.50 544,160
- ------------------------------------------------------------------------------------------------------------------------------------
72 5/24/99 6/1/09 4,337,358 Lock/35_Defeasance/78_0%/7 36,005.23 573,492
73 6/16/99 7/1/09 4,321,344 Lock/35_Defeasance/81_0%/4 36,094.55 527,713
74 7/1/99 7/5/09 4,156,075 Lock/26_Defeasance/90_0%/4 33,196.01 504,932
- ------------------------------------------------------------------------------------------------------------------------------------
75 4/6/98 5/1/08 4,045,504 Lock/59_Defeasance/61 30,784.61 534,614
75a 98,598
75b 134,773
75c 22,871
75d 157,091
75f 121,281
- ------------------------------------------------------------------------------------------------------------------------------------
76 5/24/99 6/1/09 4,001,527 Lock/35_Defeasance/81_0%/4 32,238.55 614,865
77 8/2/99 9/1/09 3,930,022 Lock/24_Defeasance/92_0%/4 33,185.92 483,428
78 6/1/99 6/1/09 3,821,325 Lock/35_Defeasance/81_0%/4 30,941.87 465,657
79 6/9/99 6/10/09 3,763,982 Lock/27_Defeasance/89_0%/4 32,743.31 471,218
80 7/30/99 8/1/09 3,612,792 Lock/25_Defeasance/91_0%/4 29,191.45 621,400
- ------------------------------------------------------------------------------------------------------------------------------------
81 6/25/99 8/1/09 3,613,346 Lock/34_Defeasance/82_0%/4 29,595.10 456,729
82 5/25/99 6/1/09 3,645,824 Lock/27_Defeasance/89_0%/4 30,692.66 464,457
83 7/10/98 8/1/08 3,434,117 Lock/35_Defeasance/81_0%/4 26,665.80 421,356
84 7/27/99 8/10/09 3,195,849 Lock/25_Defeasance/93_0%/2 31,626.97 477,986
85 5/26/99 6/10/09 3,042,478 Lock/27_Defeasance/89_0%/4 28,482.22 507,950
- ------------------------------------------------------------------------------------------------------------------------------------
86 7/6/99 8/1/09 3,360,094 Lock/35_Defeasance/78_0%/7 27,913.54 440,356
87 5/20/99 6/10/09 3,151,075 Lock/27_Defeasance/89_0%/4 26,806.87 399,862
88 7/29/99 8/1/09 3,140,777 Lock/25_Defeasance/91_0%/4 25,999.66 442,871
89 6/29/99 7/1/09 3,137,477 Lock/35_Defeasance/81_0%/4 26,206.14 379,060
90 6/4/99 7/1/09 2,852,028 Lock/35_Defeasance/81_0%/4 27,270.72 412,656
- ------------------------------------------------------------------------------------------------------------------------------------
91 6/24/99 7/1/09 3,084,661 Lock/35_Defeasance/81_0%/4 26,986.20 448,482
92 5/27/99 6/1/09 2,943,326 Lock/27_Defeasance/89_0%/4 24,304.11 415,298
93 2/12/99 3/1/09 2,987,633 Lock/36_Defeasance/80_0%/4 25,374.14 413,962
94 7/2/99 7/10/09 2,883,917 Lock/26_Defeasance/87_0%/7 25,015.94 385,942
95 5/27/99 6/1/09 2,639,871 Lock/35_Defeasance/81_0%/4 23,996.08 626,076
- ------------------------------------------------------------------------------------------------------------------------------------
96 5/24/99 6/10/09 2,851,008 Lock/27_Defeasance/93 24,381.31 368,029
97 5/17/99 6/1/09 2,826,138 Lock/47_Defeasance/69_0%/4 23,377.64 359,706
98 5/6/99 6/1/09 2,782,299 Lock/27_Defeasance/89_0%/4 21,982.13 389,564
99 7/30/99 8/10/09 2,770,449 Lock/25_Defeasance/91_0%/4 23,939.73 343,682
100 7/22/99 8/1/09 2,778,545 Lock/35_Defeasance/81_0%/4 22,919.82 350,039
- ------------------------------------------------------------------------------------------------------------------------------------
101 7/19/99 8/10/09 2,649,593 Lock/25_Defeasance/91_0%/4 22,708.94 343,510
102 2/11/99 3/1/09 2,483,150 Lock/59_Defeasance/57_0%/4 20,361.97 317,221
103 5/27/99 6/1/14 2,120,836 Lock/60_Defeasance/118_0%/2 20,424.93 295,929
104 7/23/99 8/1/09 2,364,289 Lock/35_Defeasance/81_0%/4 19,130.94 303,040
105 6/2/99 6/10/09 2,276,538 Lock/27_Defeasance/89_0%/4 18,905.95 283,721
- ------------------------------------------------------------------------------------------------------------------------------------
106 5/27/99 6/1/09 2,264,589 Lock/27_Defeasance/89_0%/4 17,970.06 330,051
107 6/2/99 6/10/09 2,190,258 Lock/27_Defeasance/89_0%/4 18,493.85 281,255
108 6/24/99 7/10/09 2,182,943 Lock/26_Defeasance/87_0%/7 19,047.79 294,770
109 6/1/99 6/10/09 2,051,695 Lock/27_Defeasance/89_0%/4 16,259.62 250,012
110 4/26/99 5/10/09 1,966,471 Lock/28_Defeasance/90_0%/2 15,975.73 243,183
- ------------------------------------------------------------------------------------------------------------------------------------
111 7/6/99 8/1/09 1,969,845 Lock/35_Defeasance/81_0%/4 16,421.96 245,436
112 6/25/99 7/10/09 1,834,096 Lock/26_Defeasance/87_0%/7 15,627.96 235,143
113 6/24/99 7/10/09 1,818,520 Lock/26_Defeasance/90_0%/4 15,023.64 221,826
114 5/11/99 6/10/09 1,794,963 Lock/27_Defeasance/93 14,906.61 223,864
115 7/30/99 8/1/09 1,839,811 Lock/35_Defeasance/81_0%/4 15,815.12 281,351
- ------------------------------------------------------------------------------------------------------------------------------------
116 4/2/99 5/1/09 1,787,011 Lock/28_Defeasance/88_0%/4 14,591.75 258,713
117 10/26/98 11/1/08 1,766,863 Lock/59_Defeasance/57_0%/4 13,984.29 258,658
118 7/28/99 8/10/09 1,725,829 Lock/25_Defeasance/91_0%/4 14,626.73 219,831
119 2/1/99 3/1/09 1,574,204 Lock/59_Defeasance/57_0%/4 14,132.46 238,977
119a 98,352
119b 140,625
- ------------------------------------------------------------------------------------------------------------------------------------
120 6/16/99 7/1/09 1,569,883 Lock/35_Defeasance/81_0%/4 15,453.86 352,684
121 12/23/98 1/1/09 1,495,278 Lock/59_Defeasance/57_0%/4 14,134.70 230,749
122 7/21/99 8/10/10 1,554,374 Lock/25_Defeasance/103_0%/4 13,516.08 210,712
123 4/23/99 5/10/09 1,579,714 Lock/28_Defeasance/88_0%/4 13,230.23 225,160
124 9/4/98 11/1/08 1,493,902 Lock/35_Defeasance/80_0%/4 11,292.36 199,482
125 7/23/99 8/10/09 1,476,116 Lock/25_Defeasance/93_0%2 12,689.13 192,930
- ------------------------------------------------------------------------------------------------------------------------------------
126 7/6/99 7/10/09 1,463,318 Lock/26_Defeasance/90_0%/4 12,740.28 200,853
127 5/26/99 6/1/09 1,454,756 Lock/35_Defeasance/81_0%/4 11,999.64 200,994
128 5/3/99 3/10/16 0 Lock/28_Defeasance/170_0%/4 13,078.79 157,775
129 9/1/98 10/1/08 1,251,499 Lock/47_Defeasance/69_0%/4 9,891.56 157,638
130 3/31/99 4/1/09 1,192,888 Lock/35_Defeasance/81_0%/4 11,267.21 195,983
- ------------------------------------------------------------------------------------------------------------------------------------
131 7/31/98 9/1/08 1,212,619 Lock/36_Defeasance/80_0%/4 9,548.38 164,886
132 7/29/99 8/10/09 1,171,171 Lock/25_Defeasance/91_0%/4 10,067.72 169,441
133 5/6/99 6/1/09 1,028,619 Lock/27_Defeasance/89_0%/4 9,589.81 191,165
134 2/1/99 3/1/09 1,009,107 Lock/59_Defeasance/57_0%/4 9,059.26 173,940
135 6/25/99 7/10/09 1,041,972 Lock/26_Defeasance/90_0%/4 9,280.69 140,494
- ------------------------------------------------------------------------------------------------------------------------------------
136 11/6/98 12/1/08 886,827 Lock/59_Defeasance/57_0%/4 7,950.88 128,924
137 8/2/99 8/10/09 861,674 Lock/25_Defeasance/91_0%/4 8,558.20 124,454
138 6/15/99 7/10/09 769,147 Lock/26_Defeasance/90_0%/4 6,617.58 95,770
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CROSS ORIGINAL ORIGINAL SCHEDULED CROSS
UNDERWRITTEN NCF COLLATERALIZED APPRAISAL APPRAISAL CUT-OFF MATURITY OR COLLATERALIZED
CONTROL NUMBER DSCR (X) DSCR (X) VALUE DATE DATE LTV (%) ARD DATE LTV (%) LTV RATIO (%)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1 1.43 132,500,000 5/5/99 60.38 53.79
2 1.36 86,400,000 1/30/99 72.73 63.59
- ------------------------------------------------------------------------------------------------------------------------------------
3 1.90 1.90 93,950,000 49.51 40.55 49.26
3a 4,050,000 4/1/99
3b 4,250,000 4/1/99
3c 3,600,000 4/1/99
3d 5,050,000 4/1/99
3e 4,400,000 4/1/99
3f 3,650,000 4/1/99
3g 4,100,000 4/1/99
3h 2,800,000 4/1/99
3I 3,700,000 4/1/99
3j 6,150,000 4/1/99
3k 4,400,000 4/1/99
3l 4,400,000 4/1/99
3m 5,300,000 4/1/99
3n 5,250,000 4/1/99
3o 4,700,000 4/1/99
3p 11,100,000 4/1/99
3q 4,750,000 4/1/99
3r 12,300,000 4/1/99
- ------------------------------------------------------------------------------------------------------------------------------------
4 1.25 59,000,000 6/10/99 72.25 63.98
5 1.43 51,600,000 4/29/99 65.19 58.31
6 1.23 38,900,000 2/11/99 74.44 66.84
7 1.31 38,600,000 7/1/99 73.83 66.23
- ------------------------------------------------------------------------------------------------------------------------------------
8 1.34 37,385,000 72.03 62.76
8a 25,000,000 3/16/99
8b 6,150,000 3/6/99
8c 4,435,000 3/11/99
8d 1,800,000 3/9/99
- ------------------------------------------------------------------------------------------------------------------------------------
9 1.24 38,000,000 5/11/99 68.38 59.77
10 1.19 28,800,000 86.42 74.10
10a 10,600,000 7/15/98
10b 14,000,000 7/15/98
10c 4,200,000 7/15/98
- ------------------------------------------------------------------------------------------------------------------------------------
11 1.27 50,000,000 7/1/99 46.00 43.57
12 1.39 25,000,000 6/22/99 71.96 74.98
13 1.32 26,300,000 12/29/98 76.66 66.86
- ------------------------------------------------------------------------------------------------------------------------------------
14 1.22 24,380,000 73.63 64.06
14a 5,900,000 3/9/99
14b 10,140,000 3/11/99
14c 8,340,000 3/10/99
- ------------------------------------------------------------------------------------------------------------------------------------
15 1.25 24,400,000 71.39 65.36
15a 12,000,000 3/17/99
15b 4,600,000 3/23/99
15c 3,100,000 3/18/99
15d 2,500,000 3/25/99
15e 2,200,000 3/24/99
- ------------------------------------------------------------------------------------------------------------------------------------
16 1.28 22,000,000 3/1/99 72.50 60.89
17 1.44 22,150,000 6/7/99 65.43 61.49
18 1.28 18,900,000 3/2/99 79.33 71.77
19 1.69 21,500,000 12/18/99 53.46 59.90
20 1.20 18,000,000 6/10/99 77.74 68.37
- ------------------------------------------------------------------------------------------------------------------------------------
21 1.20 17,000,000 5/26/99 79.95 69.64
22 1.60 22,600,000 6/1/99 58.07 51.18
23 1.32 16,600,000 64.58 66.13
23a 7,500,000 3/1/99
23b 9,100,000 3/1/99
- ------------------------------------------------------------------------------------------------------------------------------------
24 1.25 16,750,000 6/30/99 73.03 30.79
25 1.43 16,500,000 3/18/98 71.82 62.63
26 1.40 15,900,000 2/1/99 70.39 63.01
27 1.25 15,000,000 6/2/99 72.71 65.74
28 1.90 20,800,000 5/24/99 52.28 52.28
- ------------------------------------------------------------------------------------------------------------------------------------
29 1.23 13,100,000 6/2/99 78.21 70.38
30 1.36 13,600,000 2/3/99 74.30 64.27
31 1.49 17,200,000 6/1/99 58.09 48.01
32 1.45 12,250,000 4/22/99 77.07 68.84
33 1.35 13,400,000 5/7/98 70.18 60.91
- ------------------------------------------------------------------------------------------------------------------------------------
34 1.63 13,060,000 10/15/98 58.58 56.25
35 1.19 11,400,000 80.98 70.85
35a 6,600,000 3/17/99
35b 4,800,000 3/17/99
36 1.20 12,170,000 6/1/99 72.72 66.27
- ------------------------------------------------------------------------------------------------------------------------------------
37 1.29 13,100,000 4/13/99 67.05 58.81
38 1.68 14,100,000 8/1/99 57.40 47.12
39 1.20 11,300,000 2/1/99 68.92 62.00
40 1.25 11,700,000 12/1/98 64.07 56.54
41 1.41 9,500,000 2/25/99 78.27 70.36
- ------------------------------------------------------------------------------------------------------------------------------------
42 1.20 10,800,000 6/1/99 68.75 62.65
43 1.62 13,600,000 12/30/98 43.29 48.01
44 1.30 12,600,000 2/18/99 58.62 51.57
45 1.20 10,000,000 4/26/99 73.43 64.86
46 1.43 9,500,000 1/19/98 74.77 65.22
- ------------------------------------------------------------------------------------------------------------------------------------
47 1.33 10,400,000 7/1/99 67.25 55.24
48 1.20 9,100,000 6/2/99 76.78 61.96
49 1.78 12,700,000 2/1/99 54.89 47.93
50 1.25 8,400,000 6/7/99 78.54 64.42
51 1.35 10,400,000 1/19/99 63.28 51.66
- ------------------------------------------------------------------------------------------------------------------------------------
52 1.25 8,450,000 1/20/99 77.77 69.09
53 1.30 8,200,000 5/15/99 76.95 67.11
54 1.43 8,600,000 7/1/99 70.88 58.53
55 1.36 7,630,000 4/22/99 79.91 71.79
56 1.45 8,600,000 3/7/99 70.73 63.07
- ------------------------------------------------------------------------------------------------------------------------------------
57 1.20 8,700,000 4/30/99 64.92 60.90
58 1.19 9,500,000 6/16/99 63.13 55.91
59 1.25 7,600,000 2/8/99 78.12 70.10
60 1.20 7,250,000 5/13/99 79.97 71.69
- ------------------------------------------------------------------------------------------------------------------------------------
61 1.29 7,640,000 74.84 61.89
61a 1,000,000 12/23/98
61b 840,000 12/23/98
61c 860,000 12/23/98
61d 960,000 12/23/98
61e 3,980,000 12/23/98
- ------------------------------------------------------------------------------------------------------------------------------------
62 1.21 7,150,000 6/25/99 79.68 71.16
63 1.34 8,000,000 7/9/99 69.97 62.44
64 1.24 6,700,000 3/17/99 77.57 68.30
65 1.15 6,800,000 4/28/99 73.44 63.79
66 1.58 11,050,000 3/5/99 45.10 30.97
- ------------------------------------------------------------------------------------------------------------------------------------
67 1.24 6,250,000 3/10/99 79.78 69.33
68 1.28 7,100,000 1/9/98 69.90 60.84
69 1.82 9,400,000 5/11/99 52.33 43.32
70 1.45 8,200,000 6/13/98 59.92 48.41
71 1.24 6,150,000 11/16/98 79.59 70.14
- ------------------------------------------------------------------------------------------------------------------------------------
72 1.33 6,600,000 4/2/99 73.05 65.72
73 1.22 6,250,000 5/12/99 76.74 69.14
74 1.27 7,200,000 4/1/99 66.58 57.72
- ------------------------------------------------------------------------------------------------------------------------------------
75 1.45 6,580,000 71.03 61.48
75a 1,150,000 5/17/99
75b 1,600,000 5/17/99
75c 330,000 5/17/99
75d 2,200,000 5/17/99
75f 1,300,000 5/17/99
- ------------------------------------------------------------------------------------------------------------------------------------
76 1.59 6,000,000 4/5/99 74.87 66.69
77 1.21 5,900,000 6/22/99 73.76 66.61
78 1.25 5,350,000 4/14/99 80.05 71.43
79 1.20 5,750,000 5/10/99 73.70 65.46
80 1.77 5,700,000 5/30/99 71.18 63.38
- ------------------------------------------------------------------------------------------------------------------------------------
81 1.29 5,240,000 6/1/99 77.08 68.96
82 1.26 5,600,000 3/1/99 72.04 65.10
83 1.32 5,000,000 4/25/98 79.12 68.68
84 1.26 5,800,000 7/2/99 67.19 55.10
85 1.49 6,500,000 4/23/99 58.27 46.81
- ------------------------------------------------------------------------------------------------------------------------------------
86 1.31 4,650,000 4/22/99 80.40 72.26
87 1.24 5,000,000 3/28/99 71.37 63.02
88 1.42 5,400,000 6/22/99 64.79 58.16
89 1.21 4,350,000 5/12/99 80.05 72.13
90 1.26 5,500,000 1/1/99 62.11 51.86
- ------------------------------------------------------------------------------------------------------------------------------------
91 1.38 4,600,000 4/27/99 73.32 67.06
92 1.42 4,340,000 4/1/99 77.04 67.82
93 1.36 4,415,000 1/23/99 74.54 67.67
94 1.29 4,675,000 2/10/99 69.56 61.69
95 2.17 5,330,000 4/26/99 60.79 49.53
- ------------------------------------------------------------------------------------------------------------------------------------
96 1.26 4,700,000 3/19/99 68.60 60.66
97 1.28 4,600,000 5/5/99 68.37 61.44
98 1.48 4,400,000 2/2/99 71.46 63.23
99 1.20 4,875,000 9/1/99 64.17 56.83
100 1.27 4,400,000 5/21/99 70.42 63.15
- ------------------------------------------------------------------------------------------------------------------------------------
101 1.26 4,200,000 3/1/99 71.39 63.09
102 1.30 3,700,000 9/15/98 74.76 67.11
103 1.21 5,042,000 1/13/99 54.44 42.06
104 1.32 3,670,000 6/15/99 72.31 64.42
105 1.25 3,500,000 4/13/99 74.14 65.04
- ------------------------------------------------------------------------------------------------------------------------------------
106 1.53 3,200,000 1/22/99 79.86 70.77
107 1.27 3,100,000 5/5/99 80.18 70.65
108 1.29 3,500,000 10/28/98 70.22 62.37
109 1.28 3,240,000 4/27/99 73.14 63.32
110 1.27 3,050,000 3/30/99 73.90 64.47
- ------------------------------------------------------------------------------------------------------------------------------------
111 1.25 2,760,000 5/10/99 79.32 71.37
112 1.25 2,600,000 4/23/99 79.92 70.54
113 1.23 2,600,000 2/25/99 79.91 69.94
114 1.25 2,600,000 4/16/99 78.69 69.04
115 1.48 3,000,000 5/22/99 67.48 61.33
- ------------------------------------------------------------------------------------------------------------------------------------
116 1.48 3,200,000 2/2/99 62.37 55.84
117 1.54 3,000,000 7/14/98 66.21 58.90
118 1.25 2,650,000 6/7/99 73.92 65.13
119 1.41 2,700,000 71.76 58.30
119a 1,175,000 9/2/98
119b 1,525,000 9/2/98
- ------------------------------------------------------------------------------------------------------------------------------------
120 1.90 1.90 4,450,000 4/1/99 43.07 35.28 49.26
121 1.36 3,000,000 5/12/99 61.45 49.84
122 1.30 2,500,000 6/11/99 71.96 62.17
123 1.42 2,600,000 3/17/99 69.06 60.76
124 1.47 2,800,000 5/15/98 62.00 53.35
125 1.27 2,250,000 6/7/99 74.19 65.61
- ------------------------------------------------------------------------------------------------------------------------------------
126 1.31 2,400,000 5/6/99 68.69 60.97
127 1.40 2,275,000 3/30/99 71.23 63.95
128 1.01 1,750,000 3/3/99 82.93 0.00
129 1.33 2,050,000 7/31/98 70.11 61.05
130 1.45 2,150,000 2/10/99 66.67 55.48
- ------------------------------------------------------------------------------------------------------------------------------------
131 1.44 1,850,000 6/9/98 73.71 65.55
132 1.40 1,800,000 5/27/99 73.57 65.07
133 1.66 1,900,000 2/4/99 65.61 54.14
134 1.60 1,800,000 9/2/98 69.00 56.06
135 1.26 1,600,000 3/11/99 72.94 65.12
- ------------------------------------------------------------------------------------------------------------------------------------
136 1.35 1,500,000 8/20/98 72.59 59.12
137 1.21 1,450,000 12/2/98 72.35 59.43
138 1.21 1,100,000 3/7/99 79.01 69.92
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CONTROL NUMBER YEAR BUILT YEAR RENOVATED UNITS, BEDS, ROOMS, SQFT UNIT DESCRIPTION
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 1963-1996 1999 550,949 Sq Ft
2 1960, 1983-1995 1996 533,192 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
3 2,327 Rooms
3a 1993-1994 1998-1999 126 Rooms
3b 1994 1998-1999 126 Rooms
3c 1996 NAP 128 Rooms
3d 1991 1998 126 Rooms
3e 1991 1998/99 134 Rooms
3f 1987 1997 120 Rooms
3g 1985 1997/98 126 Rooms
3h 1987 1998/99 130 Rooms
3I 1991 1998 108 Rooms
3j 1996 NAP 124 Rooms
3k 1990 1998/99 111 Rooms
3l 1996 NAP 123 Rooms
3m 1985 1992 & 1999 128 Rooms
3n 1987 1995-1996 120 Rooms
3o 1988 1998-1999 96 Rooms
3p 1990 1998 168 Rooms
3q 1989 1997-1998 125 Rooms
3r 1988 & 1990 1998 208 Rooms
- -----------------------------------------------------------------------------------------------------------------
4 1890's,1920's 1991/1992 277,536 Sq Ft
5 1983 NAP 213,575 Sq Ft
6 1950 1991 213,609 Sq Ft
7 1958 NAP 301,765 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
8 2,316 Units
8a 1973 1995 1,677 Units
8b 1980 NAP 345 Units
8c 1978 1995 198 Units
8d 1978 NAP 96 Units
- -----------------------------------------------------------------------------------------------------------------
9 1984 & 1990 NAP 269,650 Sq Ft
10 660 Units
10a 1969-70 NAP 264 Units
10b 1973 NAP 264 Units
10c 1966 NAP 132 Units
- -----------------------------------------------------------------------------------------------------------------
11 1917 1985 193,639 Sq Ft
12 1997 NAP 180,683 Sq Ft
13 1972/1976 NAP 576 Units
- -----------------------------------------------------------------------------------------------------------------
14 384 Units
14a 1986 NAP 98 Units
14b 1986 1989 164 Units
14c 1986 NAP 122 Units
- -----------------------------------------------------------------------------------------------------------------
15 739,526 Sq Ft
15a 1959, 1972 1995-1996 302,700 Sq Ft
15b 1982/1998 NAP 185,000 Sq Ft
15c 1973 NAP 89,826 Sq Ft
15d 1981/1995 NAP 90,000 Sq Ft
15e 1962, 1972 NAP 72,000 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
16 1988 1997 181 Rooms
17 1998/2000 NAP 177,229 Sq Ft
18 1972 1999 614 Units
19 1974/1983/1992/1999 NAP 899,697 Sq Ft
20 1998-1999 NAP 120,225 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
21 1990/1991 NAP 278 Units
22 1987 & 1997 1994/1995 243,370 Sq Ft
23 251,862 Sq Ft
23a 1981-1983 NAP 134,057 Sq Ft
23b 1980-1981 NAP 117,805 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
24 Between 1966 & 1973 1998-1999 625 Units
25 1961 1998 373,180 Sq Ft
26 1997 NAP 179 Rooms
27 1979 1997-1998 151,946 Sq Ft
28 1998 NAP 127,082 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
29 1975 1996 189,800 Sq Ft
30 1958 1990 240,330 Sq Ft
31 1990 1995/1996 203 Rooms
32 1972 1994 448 Units
33 1929 1984 106,817 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
34 1969/1971 1997/1998 104,684 Sq Ft
35 368 Units
35a 1984 NAP 216 Units
35b 1984 NAP 152 Units
36 1989 NAP 77,583 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
37 1984 1997 89,415 Sq Ft
38 1998 NAP 108 Rooms
39 1990 NAP 55,563 Sq Ft
40 1980 NAP 90,223 Sq Ft
41 1918 1990 84,162 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
42 1959 NAP 62,042 Sq Ft
43 1907 98/1999 (ongoing) 62,589 Sq Ft
44 1966 1993 & 1996 56,132 Sq Ft
45 1969 1998-1999 286 Units
46 1973 1987 92,474 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
47 1999 NAP 106,200 Sq Ft
48 1996-1998 NAP 176 Units
49 1973, 1975 In Progress 744,800 Sq Ft
50 1987 1993-1997 126,158 Sq Ft
51 1926 1998 68,113 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
52 1997 NAP 85,410 Sq Ft
53 1987 NAP 63,461 Sq Ft
54 1996 NAP 128 Rooms
55 1987 NAP 53,928 Sq Ft
56 1988 NAP 96 Rooms
- -----------------------------------------------------------------------------------------------------------------
57 1974 1998 66 Units
58 1984 NAP 115,145 Sq Ft
59 1997-1998 NAP 124,095 Sq Ft
60 1985 1997/1998 224 Units
- -----------------------------------------------------------------------------------------------------------------
61 170 Units
61a 1920 NAP 20 Units
61b 1920 NAP 20 Units
61c 1928 NAP 20 Units
61d 1928 NAP 20 Units
61e 1961 NAP 90 Units
- -----------------------------------------------------------------------------------------------------------------
62 1905 UAV 40 Units
63 1979 1997 150,476 Sq Ft
64 1972 1997-1999 289 Units
65 1991 NAP 185,504 Sq Ft
66 1985 NAP 118,006 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
67 1976, 1996 NAP 200 Units
68 1930 1992 127,488 Sq Ft
69 1956 1989 305,148 Sq Ft
70 1990 NAP 320 Units
71 1987 & 1991 NAP 152 Units
- -----------------------------------------------------------------------------------------------------------------
72 1984 NAP 81,821 Sq Ft
73 1996, 1998 NAP 66,625 Sq Ft
74 1963 1997-1998 183,270 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
75 259 Units
75a 1969 NAP 47 Units
75b 1970 NAP 54 Units
75c 1973 NAP 14 Units
75d 1973 NAP 96 Units
75f 1973 NAP 48 Units
- -----------------------------------------------------------------------------------------------------------------
76 1968 1999 395 Units
77 1974-1976 UAV 171,042 Sq Ft
78 1989 NAP 53,821 Sq Ft
79 1985 NAP 62,036 Sq Ft
80 1971 1992 192 Units
- -----------------------------------------------------------------------------------------------------------------
81 1987 NAP 52,425 Sq Ft
82 1988 1995 27,514 Sq Ft
83 1967 1998 228 Units
84 1984 NAP 263,500 Sq Ft
85 1965/1973 1989 163,090 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
86 1967 UAV 132 Units
87 1984 NAP 40,834 Sq Ft
88 1975 1994 76,372 Sq Ft
89 1984 1997-1998 144 Units
90 1966 - 1975 1998 110,848 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
91 1976, 1985 1996 80,891 Sq Ft
92 1986 NAP 158 Units
93 1971 & 1983 1998 55,162 Sq Ft
94 1984 NAP 51,117 Sq Ft
95 1980-1982, 1985-1989 1997 107,664 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
96 1942/1975 NAP 26,775 Sq Ft
97 1984 NAP 139,971 Sq Ft
98 1990 NAP 21,523 Sq Ft
99 1999 NAP 24,444 Sq Ft
100 1983 NAP 30,838 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
101 1965-1986 NAP 87,285 Sq Ft
102 1970 NAP 44,923 Sq Ft
103 1997-1998 NAP 120 Units
104 1905 1994 25,711 Sq Ft
105 1972-1980 1998 100 Units
- -----------------------------------------------------------------------------------------------------------------
106 1970 1994 164 Units
107 1998 NAP 35,720 Sq Ft
108 1976 NAP 30,947 Sq Ft
109 1986 NAP 107 Pads
110 1968 1997/1998 64 Units
- -----------------------------------------------------------------------------------------------------------------
111 1998/1999 NAP 37,484 Sq Ft
112 1962, 1963 1998 83 Units
113 1973 1986/ongoing 100 Units
114 1925/1965-1967 NAP 59 Units
115 1986 NAP 46,562 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
116 1987 NAP 29,352 Sq Ft
117 1967 1986 184 Pads
118 1970 thru 1977 1998 58 Units
119 45,092 Sq Ft
119a 1970 1985 20,000 Sq Ft
119b 1987 NAP 25,092 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
120 1992 1998-1999 126 Rooms
121 1915 1987 90,000 Sq Ft
122 1999 NAP 11,000 Sq Ft
123 1972 NAP 110 Units
124 1980 1991 18,122 Sq Ft
125 1981 NAP 72 Units
- -----------------------------------------------------------------------------------------------------------------
126 1945 1995 20,700 Sq Ft
127 1984, 1986 NAP 64,125 Sq Ft
128 1996 NAP 12,608 Sq Ft
129 1988 NAP 20,108 Sq Ft
130 1985 NAP 27,650 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
131 1985 1995 30,312 Sq Ft
132 1966 1998-1999 100 Units
133 1982 NAP 40,400 Sq Ft
134 1959 NAP 31,222 Sq Ft
135 1998 NAP 9,742 Sq Ft
- -----------------------------------------------------------------------------------------------------------------
136 1973 NAP 36 Units
137 1998 NAP 15,000 Sq Ft
138 1970 1996-98 28 Units
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CUT-OFF DATE BALANCE PER ANNUAL
CONTROL NUMBER SQ. FT., UNIT,BED, REQUIRED
PAD OF ROOM ($) OCCUPANCY (%) OCCUPANCY DATE OWNERSHIP INTEREST LOCKBOX RESERVES
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1 145.20 96 6/15/99 Fee Simple Soft 0
2 117.85 96 3/1/99 Fee Simple Hard 79,980
- ------------------------------------------------------------------------------------------------------------------------------------
3 19,987.67 Fee Simple and Leasehold Hard 2,121,487
3a 68 6/30/99 Fee Simple
3b 69 6/30/99 Fee Simple
3c 65 6/30/99 Fee Simple
3d 71 6/30/99 Fee Simple
3e 66 6/30/99 Fee Simple
3f 62 6/30/99 Fee Simple
3g 77 6/30/99 Fee Simple
3h 65 6/30/99 Fee Simple
3I 73 6/30/99 Fee Simple
3j 73 6/30/99 Leasehold
3k 68 6/30/99 Fee Simple
3l 79 6/30/99 Fee Simple
3m 87 6/30/99 Fee Simple
3n 79 6/30/99 Fee Simple
3o 81 6/30/99 Leasehold
3p 81 6/30/99 Fee Simple
3q 76 6/30/99 Fee Simple
3r 66 6/30/99 Fee Simple
- ------------------------------------------------------------------------------------------------------------------------------------
4 153.59 91 5/17/99 Fee Simple Hard 27,754
5 157.51 99 4/30/99 Fee Simple Hard 43,942
6 135.55 100 3/31/99 Fee Simple Hard 10,750
7 94.44 97 5/31/99 Fee Simple NAP 60,282
- ------------------------------------------------------------------------------------------------------------------------------------
8 11,626.38 Fee Simple NAP 696,300
8a 85 3/16/99
8b 93 3/16/99
8c 97 3/16/99
8d 97 3/17/99
- ------------------------------------------------------------------------------------------------------------------------------------
9 96.37 95 7/31/99 Fee Simple Soft 43,144
10 37,709.33 Fee Simple Soft 4,448,763
10a 95 4/22/99
10b 99 4/22/99
10c 96 4/22/99
- ------------------------------------------------------------------------------------------------------------------------------------
11 118.78 97 7/1/99 Fee Simple NAP 29,436
12 116.17 98 6/22/99 Fee Simple NAP 22,242
13 35,004.24 94 4/1/99 Fee Simple Springing 144,000
- ------------------------------------------------------------------------------------------------------------------------------------
14 46,745.65 Fee Simple Hard 106,824
14a 92 4/19/99
14b 95 4/21/99
14c 100 4/19/99
- ------------------------------------------------------------------------------------------------------------------------------------
15 23.56 Fee Simple NAP 0
15a 100 3/17/99
15b 100 6/10/99
15c 100 6/10/99
15d 100 6/10/99
15e 100 6/10/99
- ------------------------------------------------------------------------------------------------------------------------------------
16 88,116.50 71 12/31/98 Fee Simple NAP 378,579
17 86.01 97 7/6/99 Leasehold NAP 19,672
18 24,420.11 97 3/31/99 Fee Simple Springing 153,504
19 16.11 100 5/7/99 Fee Simple Soft 92,628
20 116.39 100 6/10/99 Fee Simple Springing 13,224
- ------------------------------------------------------------------------------------------------------------------------------------
21 48,891.20 94 5/3/99 Fee Simple Soft 67,560
22 53.92 100 7/5/99 Fee Simple Hard 0
23 49.34 Fee Simple Hard 40,250
23a 89 2/22/99
23b 86 2/22/99
- ------------------------------------------------------------------------------------------------------------------------------------
24 19,570.86 85 6/30/99 Fee Simple NAP 162,504
25 31.76 89 2/1/99 Fee Simple Springing 0
26 62,521.37 77 6/30/99 Fee Simple Hard 0
27 71.78 90 6/18/99 Fee Simple NAP 22,788
28 85.57 100 5/10/99 Fee Simple NAP 0
- ------------------------------------------------------------------------------------------------------------------------------------
29 53.98 93 6/18/99 Fee Simple NAP 30,368
30 42.04 90 12/31/98 Fee Simple Soft 40,872
31 49,223.18 73 6/15/99 Leasehold Hard 429,872
32 21,073.98 88 5/25/99 Fee Simple NAP 156,800
33 88.04 91 5/31/99 Fee Simple Springing 21,360
- ------------------------------------------------------------------------------------------------------------------------------------
34 88.80 99 4/1/99 Leasehold NAP 12,562
35 25,086.13 Fee Simple NAP 98,080
35a 96 4/27/99
35b 95 4/27/99
36 114.07 100 6/9/99 Fee Simple NAP 11,637
- ------------------------------------------------------------------------------------------------------------------------------------
37 98.23 80 5/24/99 Fee Simple Springing 13,412
38 74,938.69 81 6/18/99 Fee Simple Springing 133,033
39 140.17 96 7/13/99 Fee Simple NAP 8,340
40 83.08 98 4/16/99 Fee Simple Springing 18,948
41 88.35 94 3/31/99 Fee Simple NAP 18,516
- ------------------------------------------------------------------------------------------------------------------------------------
42 119.68 98 6/9/99 Fee Simple NAP 9,306
43 118.02 91 4/1/99 Leasehold Soft 16,273
44 131.59 100 3/1/99 Fee Simple NAP 6,174
45 25,673.16 96 4/21/99 Fee Simple NAP 57,200
46 76.82 99 3/31/99 Fee Simple Springing 13,811
- ------------------------------------------------------------------------------------------------------------------------------------
47 65.86 100 5/25/99 Fee Simple Soft 15,930
48 39,696.91 96 6/2/99 Fee Simple NAP 34,144
49 9.36 100 1/25/99 Fee Simple NAP 22,344
50 52.30 97 6/18/99 Fee Simple Hard 21,551
51 96.62 93 3/30/99 Fee Simple NAP 6,816
- ------------------------------------------------------------------------------------------------------------------------------------
52 76.94 99 6/17/99 Fee Simple NAP 0
53 99.42 97 3/31/99 Fee Simple Springing 17,163
54 47,619.34 74 6/15/99 Fee Simple Hard 30,000
55 113.07 100 7/16/99 Leasehold NAP 10,856
56 63,361.41 84 12/31/98 Fee Simple Springing 0
- ------------------------------------------------------------------------------------------------------------------------------------
57 91,339.55 100 5/10/99 Fee Simple NAP 0
58 52.08 94 7/22/99 Fee Simple NAP 17,272
59 47.85 96 4/10/99 Fee Simple NAP 12,410
60 25,881.53 95 6/30/99 Fee Simple NAP 50,400
- ------------------------------------------------------------------------------------------------------------------------------------
61 33,633.10 Fee Simple NAP 48,105
61a 100 2/16/99
61b 100 2/16/99
61c 100 2/16/99
61d 100 2/16/99
61e 100 2/16/99
- ------------------------------------------------------------------------------------------------------------------------------------
62 142,433.94 100 7/1/99 Fee Simple NAP 12,000
63 37.20 85 7/22/99 Fee Simple NAP 19,018
64 17,983.61 71 5/13/99 Fee Simple NAP 72,250
65 26.92 100 4/30/99 Fee Simple Hard 18,552
66 42.23 97 6/10/99 Fee Simple NAP 23,604
- ------------------------------------------------------------------------------------------------------------------------------------
67 24,930.21 91 4/1/99 Fee Simple NAP 47,800
68 38.93 88 7/21/99 Fee Simple Springing 18,564
69 16.12 78 6/30/99 Fee Simple NAP 65,769
70 15,354.74 93 12/31/98 Fee Simple NAP 57,600
71 32,202.91 91 4/30/99 Fee Simple NAP 39,520
- ------------------------------------------------------------------------------------------------------------------------------------
72 58.93 100 4/15/99 Fee Simple NAP 12,274
73 71.99 96 5/12/99 Fee Simple NAP 6,663
74 26.16 99 4/9/99 Fee Simple Soft 31,156
- ------------------------------------------------------------------------------------------------------------------------------------
75 18,044.22 Fee Simple NAP 96,946
75a 96 3/30/99
75b 87 3/30/99
75c 79 3/30/99
75d 84 3/30/99
75f 100 3/30/99
- ------------------------------------------------------------------------------------------------------------------------------------
76 11,373.04 96 5/17/99 Fee Simple NAP 87,295
77 25.44 100 3/1/99 Fee Simple NAP 44,471
78 79.58 100 3/29/99 Fee Simple NAP 10,764
79 68.31 100 5/17/99 Fee Simple NAP 27,300
80 21,130.40 98 4/1/99 Fee Simple NAP 57,600
- ------------------------------------------------------------------------------------------------------------------------------------
81 77.05 100 6/1/99 Fee Simple NAP 8,388
82 146.63 100 5/31/99 Fee Simple NAP 4,127
83 17,350.97 100 4/20/99 Fee Simple Springing 60,256
84 14.79 100 6/30/99 Fee Simple Hard 26,352
85 23.23 93 4/30/99 Fee Simple Springing 48,927
- ------------------------------------------------------------------------------------------------------------------------------------
86 28,321.44 92 6/2/99 Fee Simple NAP 33,000
87 87.39 95 3/31/99 Fee Simple NAP 10,617
88 45.81 75 7/1/99 Fee Simple NAP 11,456
89 24,181.62 94 6/25/99 Fee Simple NAP 30,240
90 30.82 100 5/1/99 Fee Simple NAP 16,632
- ------------------------------------------------------------------------------------------------------------------------------------
91 41.70 92 4/22/99 Fee Simple NAP 18,605
92 21,162.86 93 5/26/99 Fee Simple NAP 39,504
93 59.66 98 3/18/99 Fee Simple NAP 11,022
94 63.62 95 5/20/99 Fee Simple NAP 7,668
95 30.10 90 4/30/99 Fee Simple NAP 16,150
- ------------------------------------------------------------------------------------------------------------------------------------
96 120.42 100 4/21/99 Fee Simple NAP 8,172
97 22.47 100 5/1/99 Fee Simple NAP 28,721
98 146.09 96 5/3/99 Fee Simple NAP 4,305
99 127.99 100 7/22/99 Leasehold Hard 3,672
100 100.48 100 4/1/99 Fee Simple NAP 437
- ------------------------------------------------------------------------------------------------------------------------------------
101 34.35 100 6/14/99 Fee Simple Hard 0
102 61.58 92 4/30/99 Fee Simple Hard 7,527
103 22,874.83 98 4/27/99 Fee Simple Springing 27,000
104 103.21 100 7/12/99 Fee Simple NAP 3,857
105 25,950.05 98 3/31/99 Fee Simple NAP 25,446
- ------------------------------------------------------------------------------------------------------------------------------------
106 15,581.62 99 5/13/99 Fee Simple NAP 41,000
107 69.58 100 5/18/99 Fee Simple NAP 5,358
108 79.42 98 3/1/99 Fee Simple NAP 6,840
109 22,147.33 87 5/1/99 Fee Simple NAP 4,812
110 35,217.97 100 4/9/99 Fee Simple NAP 0
- ------------------------------------------------------------------------------------------------------------------------------------
111 58.40 100 7/31/99 Fee Simple NAP 3,756
112 25,034.46 100 3/11/99 Fee Simple NAP 19,505
113 20,776.00 100 4/1/99 Fee Simple NAP 26,200
114 34,679.01 98 3/31/99 Fee Simple NAP 0
115 43.48 96 5/31/99 Fee Simple NAP 1,125
- ------------------------------------------------------------------------------------------------------------------------------------
116 68.00 97 3/1/99 Fee Simple NAP 5,870
117 10,795.78 96 5/7/99 Fee Simple Springing 74,304
118 33,775.46 98 7/31/99 Fee Simple NAP 14,964
119 42.97 Fee Simple Springing 6,764
119a 100 1/1/99
119b 96 4/21/99
- ------------------------------------------------------------------------------------------------------------------------------------
120 15,212.36 66 6/30/99 Fee Simple Hard 88,372
121 20.48 89 4/6/99 Fee Simple Springing 11,250
122 163.55 100 6/1/99 Fee Simple NAP 1,650
123 16,323.80 99 3/22/99 Fee Simple NAP 0
124 95.79 85 3/31/99 Leasehold Springing 3,615
125 23,182.98 100 6/24/99 Fee Simple NAP 23,112
- ------------------------------------------------------------------------------------------------------------------------------------
126 79.63 100 4/1/99 Fee Simple NAP 1,656
127 25.27 100 5/3/99 Fee Simple NAP 9,619
128 115.10 100 3/1/99 Fee Simple Hard 0
129 71.47 91 5/13/99 Fee Simple Springing 0
130 51.84 100 3/23/99 Leasehold NAP 4,473
- ------------------------------------------------------------------------------------------------------------------------------------
131 44.99 100 3/31/99 Fee Simple Springing 4,671
132 13,243.45 100 7/1/99 Fee Simple NAP 27,500
133 30.85 100 5/3/99 Fee Simple NAP 8,088
134 39.78 100 5/13/99 Fee Simple NAP 8,424
135 119.79 100 4/20/99 Fee Simple NAP 974
- ------------------------------------------------------------------------------------------------------------------------------------
136 30,246.22 94 3/24/99 Fee Simple Hard 10,800
137 69.94 100 6/1/99 Fee Simple Soft 2,250
138 31,040.64 100 5/1/99 Fee Simple NAP 0
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LARGEST TENANT
CONTROL NUMBER ANNUAL REQUIRED TI/LC LARGEST TENANT LARGEST TENANT SQ FT LEASE EXPIRATION
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 0 Saks Fifth Avenue 90,114 10/31/17
2 740,892 Linens N' Things 27,175 9/30/05
- ------------------------------------------------------------------------------------------------------------------------------
3 0
3a
3b
3c
3d
3e
3f
3g
3h
3I
3j
3k
3l
3m
3n
3o
3p
3q
3r
- ------------------------------------------------------------------------------------------------------------------------------
4 274,205 AMC Theaters 47,883 11/19/06
5 350,571 Comerica Bank 49,426 1/31/03
6 10,500 Anthem INC 185,409 12/31/18
7 120,000 US Life 85,615 12/31/06
- ------------------------------------------------------------------------------------------------------------------------------
8 0
8a
8b
8c
8d
- ------------------------------------------------------------------------------------------------------------------------------
9 364,848 NLAC Regional Center 30,161 4/30/06
10 0
10a
10b
10c
- ------------------------------------------------------------------------------------------------------------------------------
11 50,004 Gersch Agency 8,094 6/30/02
12 0 HomePlace 53,000 5/31/12
13 0
- ------------------------------------------------------------------------------------------------------------------------------
14 0
14a
14b
14c
- ------------------------------------------------------------------------------------------------------------------------------
15 0
15a Sweet Paper Distribution 302,700 5/31/20
15b Sweet Paper Co. 185,000 5/31/20
15c Sweet Paper Sales Corp. 89,826 5/31/20
15d Sweet Paper Sales Corporation 90,000 5/31/20
15e Sweet Paper Sales Corporation 72,000 5/31/20
- ------------------------------------------------------------------------------------------------------------------------------
16 0
17 0 Tom Thumb 63,280 8/15/18
18 0
19 0 TBC Corporation 586,942 11/30/09
20 0 Air Touch Cellular 105,225 12/31/06
- ------------------------------------------------------------------------------------------------------------------------------
21 0
22 0 InteSys Technologies, Inc. 243,370 2/1/19
23 0
23a Drug Systems, Inc (AMS) 13,953 11/30/01
23b Apria Healthcare 59,085 10/31/01
- ------------------------------------------------------------------------------------------------------------------------------
24 0
25 0 County of Los Angeles 57,096 MTM
26 0
27 75,960 Handyman Hardware 12,000 6/30/13
28 0 The Hartford 69,097 1/31/09
- ------------------------------------------------------------------------------------------------------------------------------
29 50,000 Albertson's 53,820 8/31/06
30 232,800 LA Unified School District 43,529 9/30/03
31 0
32 0
33 133,431 Kaiser 55,849 8/31/01
- ------------------------------------------------------------------------------------------------------------------------------
34 62,496 99 Ranch Market 34,624 4/1/08
35 0
35a
35b
36 77,000 St. Luke's/Unity Health 31,084 4/30/04
- ------------------------------------------------------------------------------------------------------------------------------
37 60,000 Assured Access 50,666 5/31/05
38 0
39 32,000 Blockbuster Video 6,540 6/30/99
40 143,750 Inchcape 67,246 9/30/01
41 22,200 Weltman, Weinberg & Associates 37,082 4/30/00
- ------------------------------------------------------------------------------------------------------------------------------
42 62,535 Memorial Service Life Insur. 28,663 6/30/02
43 104,173 Antwerp Sales Int'l 3,184 6/30/00
44 0 Houlihan Lokey & Howard, LLP 36,498 9/21/05
45 0
46 69,048 Internal Revenue Service 58,359 3/23/07
- ------------------------------------------------------------------------------------------------------------------------------
47 50,000 Preferred Freezer Services 106,200 6/30/19
48 0
49 0 ODW Logistics 744,800 3/31/11
50 0 K-Mart Corporation 86,479 11/30/13
51 200,004 Vartec 5,550 6/30/02
- ------------------------------------------------------------------------------------------------------------------------------
52 0 Winn-Dixie Texas, Inc. 61,834 2/4/18
53 24,000 Kern County Mental Health (Off 23,187 6/30/04
54 0
55 0 Safeway, Inc. 41,650 10/31/12
56 0
- ------------------------------------------------------------------------------------------------------------------------------
57 0
58 100,000 Barrios Technology, Inc. 11,551 3/31/05
59 15,396 Nevada Assoc. of Handicapped 13,200 5/31/03
60 0
- ------------------------------------------------------------------------------------------------------------------------------
61 0
61a
61b
61c
61d
61e
- ------------------------------------------------------------------------------------------------------------------------------
62 0
63 0 Minyard Food Stores 70,674 9/30/17
64 0
65 0 Sears Roebuck & Company 185,504 1/14/09
66 0 Regulus West LLC 15,592 2/28/02
- ------------------------------------------------------------------------------------------------------------------------------
67 0
68 0 Meredith, Cohen 6,732 12/31/99
69 48,750 Denim & Diamonds 30,000 12/31/03
70 0
71 0
- ------------------------------------------------------------------------------------------------------------------------------
72 36,000 Long Island Savings 12,318 5/31/01
73 5,004 Office Depot 30,138 6/23/11
74 28,980 Acme Supermarket 70,850 10/31/17
- ------------------------------------------------------------------------------------------------------------------------------
75 0
75a
75b
75c
75d
75f
- ------------------------------------------------------------------------------------------------------------------------------
76 0
77 56,250 Summit Auto Sales 91,577 4/30/02
78 3,000 Thrifty Payless (Rite Aid) 17,880 5/31/09
79 53,988 San Gabriel/Pomona Valley 45,000 2/28/09
80 0
- ------------------------------------------------------------------------------------------------------------------------------
81 44,400 Comps.com, Inc. 41,015 1/31/04
82 5,100 R. A. B. Motors 16,894 6/30/20
83 0
84 0 APCOA/Standard Parking, Inc. 263,500 5/31/11
85 0 Rose's 52,551 2/28/01
- ------------------------------------------------------------------------------------------------------------------------------
86 0
87 0 McAmis Occupational Clinic 10,981 2/28/05
88 0 Radio One 21,546 12/31/11
89 0
90 33,000 Michael's Crafts 30,120 2/28/09
- ------------------------------------------------------------------------------------------------------------------------------
91 50,040 Weiner's 25,200 10/31/01
92 0
93 33,899 Childrens Hospital Thrift Shop 8,800 7/9/03
94 29,344 Outback Steakhouse 7,060 9/1/05
95 0
- ------------------------------------------------------------------------------------------------------------------------------
96 12,000 Bizu (Lombardi's) 5,370 12/31/08
97 36,000 MICLA - I 21,700 2/28/03
98 32,004 Huntington Reproductive Center 3,337 4/30/04
99 20,004 Capital Title Group, Inc. 24,444 12/31/12
100 20,000 Malmquist, Fields, O'Flaherty 9,051 9/30/03
- ------------------------------------------------------------------------------------------------------------------------------
101 40,000 Scott Company of California 87,285 8/1/19
102 12,000 Opti-Fashion 33,590 12/31/10
103 0
104 0 Oliver Russell 9,034 12/31/13
105 0
- ------------------------------------------------------------------------------------------------------------------------------
106 0
107 3,081 Food Lion 29,000 1/26/19
108 38,388 Maryland National Mortgage 11,780 8/31/03
109 0
110 0
- ------------------------------------------------------------------------------------------------------------------------------
111 0 Orion Financial 7,425 7/31/03
112 0
113 0
114 0
115 0 Women's Total Fitness 10,013 5/1/05
- ------------------------------------------------------------------------------------------------------------------------------
116 7,400 Places in the Heart 7,412 5/30/04
117 0
118 0
119 24,000
119a Tri State News 5,600 6/14/01
119b Pictura, Inc. 24,092 4/30/02
- ------------------------------------------------------------------------------------------------------------------------------
120 0
121 36,000 Randall Leather Mach. Corp. 18,750 6/30/00
122 11,112 Men's Wearhouse 5,500 3/31/09
123 0
124 20,784 Holualoa Management Corporatio 1,933 4/30/01
125 0
- ------------------------------------------------------------------------------------------------------------------------------
126 32,000 D. Seprazadeh/A. Khalioun 9,200 3/31/01
127 18,000 Copyright Printing 40,500 12/31/01
128 0 CVS 12,608 3/31/16
129 0 Norwest Mortgage 3,248 1/31/02
130 40,488 E3 Group 8,675 12/31/00
- ------------------------------------------------------------------------------------------------------------------------------
131 0 Safelite Glass Corporation 10,400 1/31/02
132 0
133 10,200 Bentley's Display 10,000 3/31/01
134 6,480 Everready Thermometer 20,000 12/31/04
135 8,400 Wahid Wafa & Rahmat Adel 2,700 7/31/01
- ------------------------------------------------------------------------------------------------------------------------------
136 0
137 8,799 Cato's 4,200 5/1/03
138 0
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CERTAIN CHARACTERISTICS OF THE MULTIFAMILY LOANS
Control Loan
Number Number Property Name City County State
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
8 21584 Texas Development Investors Apartment Portfolio
8a 21584-A Willow Creek Apartments Houston Harris Texas
8b 21584-B Bellfort Southwest IV and V Apartments Houston Harris Texas
8c 21584-C Southwest Village Apartments Houston Harris Texas
8d 21584-D Bellfort Southwest III Houston Harris Texas
- ------------------------------------------------------------------------------------------------------------------------------------
10 GA5851 Alliance TP Portfolio
10a GA5851-A Alliance TP - Mulberry Lane Apartments Midland Midland Michigan
10b GA5851-B Rambletree Apartments Glen Ellyn DuPage Illinois
10c GA5851-C Robin Oaks Apartments Midland Midland Michigan
13 GA5614 Sherwood Lakes Apartments Schererville Lake County Indiana
- ------------------------------------------------------------------------------------------------------------------------------------
14 22748 Laurel Apartment Portfolio
14a 22748-A Laurel Walk Apartments Charlotte Mecklenburg North Carolina
14b 22748-B Laurel Oaks Apartments Raleigh Wake North Carolina
14c 22748-C Laurel Springs Apartments Raleigh Wake North Carolina
18 TA1103 Village Square Apartments Indianapolis Marion Indiana
- ------------------------------------------------------------------------------------------------------------------------------------
21 23908 Tivoli Lakes Club Apartments Deerfield Beach Broward Florida
24 23650 Columbus Park Apartments Bedford Cuyahoga Ohio
32 09-0001248 Plantation Oaks College Station Brazos Texas
35 22396 Riverbend and Cedar Lake Apartments
35a 22396-A Riverbend Apartments Norman Cleveland Oklahoma
35b 22396-B Cedar Lake Apartments Norman Cleveland Oklahoma
- ------------------------------------------------------------------------------------------------------------------------------------
45 22471 Austin Lights Apartments Austin Travis Texas
48 19169 St. Augustine Hills Apartments Tallahassee Leon Florida
57 22603 The Bridgeport Apartments Huntington Beach Orange California
60 09-0001260 Chimney Apartments El Paso El Paso Texas
- ------------------------------------------------------------------------------------------------------------------------------------
61 TA5740 Jackson Heights Portfolio
61a TA5740-A 35-18 95th Street Jackson Heights Queens New York
61b TA5740-B 35-24 95th Street Jackson Heights Queens New York
61c TA5740-C 35-38 95th Street Jackson Heights Queens New York
61d TA5740-D 35-44 95th Street Jackson Heights Queens New York
61e TA5740-E 93-35 Lamont Avenue Elmhurst Queens New York
- ------------------------------------------------------------------------------------------------------------------------------------
62 911660589 1110-1120 Beacon Street Brookline Norfolk Massachusetts
64 22788 Plaza Apartments Tallahassee Leon County Florida
67 22124 Chase Hill Apartments San Antonio Bexar Texas
70 22252 Villa Mirage Apartments Lancaster Los Angeles California
71 20670 Summerchase Apartments Prattville Autauga Alabama
- ------------------------------------------------------------------------------------------------------------------------------------
75 TA2352 Satcoms Apartments
75a TA2352-A Satcoms - French Quarter Apartments Lincoln Lancaster Nebraska
75b TA2352-B Crescent Plaza Apartments Lincoln Lancaster Nebraska
75c TA2352-C 2101 D Street Apartments Lincoln Lancaster Nebraska
75d TA2352-D Willow Wood Apartments Lincoln Lancaster Nebraska
75f TA2352-F Arapahoe Village Apartments Lincoln Lancaster Nebraska
- ------------------------------------------------------------------------------------------------------------------------------------
76 09-0001242 Sharpstown Garden Apartments Houston Harris Texas
80 901851850 Summer Pointe & Windrock Apartments Norman Cleveland Oklahoma
83 TA4664 St. James Garden Apartments Chester Delaware Pennsylvania
86 907120356 Community Manor Apartments Henrietta Monroe New York
89 09-0001257 Courts of McCallum Apartments Dallas Collin Texas
- ------------------------------------------------------------------------------------------------------------------------------------
92 TA7792 Mallard Creek Apartments Statesville Iredell North Carolina
103 23193 Rivercrest Apartments Albany Dougherty/Lee Counties Georgia
105 21956 Canden-Damada Apartments Portage Porter Indiana
106 09-0001245 Citadel Apartments Kansas City Jackson Missouri
110 21857 Los Olivos Apartments Phoenix Maricopa Arizona
- ------------------------------------------------------------------------------------------------------------------------------------
112 21775 Wickham Gardens Condominiums East Hartford Hartford Connecticut
113 21159 The Commodore Apartments Vicksburg Warren Mississippi
114 18842 South Park Apartments Manchester Hartford Connecticut
118 23338 Logan Point Apartments Riverside Riverside California
123 18035 Canyon Hills Apartments El Paso El Paso Texas
- ------------------------------------------------------------------------------------------------------------------------------------
125 22494 Oak Forest Apartments Bryan-College Station Brazos Texas
132 23294 Park West I Apartments Atlanta Fulton Georgia
136 TA5681 Park Villa Apartments Oxford Oakland Michigan
138 21856 13400 Victory Apartments Valley Glen Los Angeles California
- ------------------------------------------------------------------------------------------------------------------------------------
* Employee Unit
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
INITIAL STUDIOS
CONTROL INITIAL POOL POOL BALANCE AVG RENT
NUMBER ZIP CODE BALANCE ($) PER UNIT ($) UTILITIES PAID BY TENANT # UNITS PER MO. ($)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
8 26,926,701 11,626.38
8a 77012 Electricity/Cable
8b 77071 Electricity/Cable 3 275
8c 77477 Electricity/Cable
8d 77035 Electricity/Cable 4 315
- ------------------------------------------------------------------------------------------------------------------------------------
10 24,888,157 37,709.33
10a 48642 Electricity
10b 60137 Electricity
10c 48642 Electricity
13 46375 20,162,442 35,004.24
- ------------------------------------------------------------------------------------------------------------------------------------
14 17,950,331 46,745.65
14a 28270 Gas/Electricity/Cable
14b 27613 Gas/Electricity/Cable
14c 27609 Gas/Electricity/Cable
18 46224 14,993,950 24,420.11 Electricity
- ------------------------------------------------------------------------------------------------------------------------------------
21 33441 13,591,754 48,891.20 Gas/Electricity/Cable
24 44146 12,231,790 19,570.86 Electricity/Cable
32 77840 9,441,145 21,073.98 Electricity/Cable/Trash
35 9,231,694 25,086.13
35a 73071 Gas/Electricity/Cable
35b 73072 Gas/Electricity/Cable
- ------------------------------------------------------------------------------------------------------------------------------------
45 78723 7,342,525 25,673.16 Water/Electricity/Cable
48 32301 6,986,655 39,696.91 Water/Gas/Electricity/Cable
57 92649 6,028,410 91,339.55 Gas/Electricity/Cable
60 79912 5,797,463 25,881.53 Electricity
- ------------------------------------------------------------------------------------------------------------------------------------
61 5,717,627 33,633.10
61a 11372 Gas/Electricity
61b 11372 Gas/Electricity
61c 11372 Gas/Electricity
61d 11372 Gas/Electricity
61e 11372 Gas/Electricity 38 540
- ------------------------------------------------------------------------------------------------------------------------------------
62 02146 5,697,357 142,433.94 Electricity/Cable
64 32304 5,197,262 17,983.61 Gas/Electricity 68 405
67 78256 4,986,042 24,930.21 Electricity/Cable 32 379
70 93534 4,913,515 15,354.74 Gas/Electricity/Cable
71 36066 4,894,842 32,202.91 Gas/Electricity/Cable
- ------------------------------------------------------------------------------------------------------------------------------------
75 4,673,453 18,044.23
75a 68503 Gas/Electricity
75b 68504 Gas/Electricity
75c 68502 Gas/Electricity
75d 68502 Gas/Electricity
75f 68502 Gas/Electricity
- ------------------------------------------------------------------------------------------------------------------------------------
76 77074 4,492,352 11,373.04 108 Tenants pay electricity
80 73072 4,057,037 21,130.40 Electricity/Cable
83 19013 3,956,022 17,350.97 Electricity
86 14623 3,738,431 28,321.44 Electricity/Cable
89 75252 3,482,154 24,181.62 Electricity/Cable
- ------------------------------------------------------------------------------------------------------------------------------------
92 28677 3,343,732 21,162.86 Electricity
103 31705 2,744,979 22,874.83 Water/Gas/Electricity/Cable
105 46368 2,595,005 25,950.05 Electricity/Cable
106 64110 2,555,385 15,581.62 Electricity
110 85021 2,253,950 35,217.97 Gas/Electricity/Cable
- ------------------------------------------------------------------------------------------------------------------------------------
112 06108 2,077,860 25,034.46 Electricity/Cable
113 39180 2,077,600 20,776.00 Electricity/Cable
114 06040 2,046,062 34,679.01 Electricity/Cable
118 92501 1,958,977 33,775.46 Gas/Electricity/Cable
123 79904 1,795,619 16,323.80 Gas/Electricity/Cable
- ------------------------------------------------------------------------------------------------------------------------------------
125 77801 1,669,175 23,182.98 Electricity/Cable
132 30331 1,324,345 13,243.45 Gas/Electricity/Cable
136 48371 1,088,864 30,246.22 Gas/Electricity
138 91401 869,138 31,040.64 Gas/Electricity/Cable 3 450
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
1 BEDROOM 2 BEDROOM 3 BEDROOM 4 BEDROOM
Control Avg Rent Avg Rent Avg Rent Avg Rent
Number # Units per mo. ($) # Units per mo. ($) # Units per mo. ($) # Units per mo. ($)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
8
8a 1401 374 276 518
8b 166 345 168 469 8 585
8c 118 394 80 536
8d 32 375 60 479
- ------------------------------------------------------------------------------------------------------------------------------
10
10a 22 535 198 595 44 705
10b 152 654 100 852 12 1000
10c 36 540 96 550
13 252 550 324 653
- ------------------------------------------------------------------------------------------------------------------------------
14
14a 48 650 50 836
14b 106 635 58 846
14c 50 660 72 851
18 184 453 340 543 90 672
- ------------------------------------------------------------------------------------------------------------------------------
21 134 762 144 890
24 208 465 393 600 24 725
32 272 410 150 572 24 805 1 1150
35
35a 108 372 108 478
35b 76 384 76 501
- ------------------------------------------------------------------------------------------------------------------------------
45 65 495 220 642 1 641
48 132 569 44 670
57 15 765 33 1217 18 1427
60 144 432 80 575
- ------------------------------------------------------------------------------------------------------------------------------
61
61a 1 676 19 667
61b 20 569
61c 20 583
61d 20 652
61e 51 570 1 0 *
- ------------------------------------------------------------------------------------------------------------------------------
62 3 1533 31 1662 6 1865
64 162 380 48 560 11 677
67 60 457 107 551 1 935
70 64 475 232 500 24 650
71 64 475 64 565 24 675
- ------------------------------------------------------------------------------------------------------------------------------
75
75a 11 350 36 431
75b 21 395 33 480
75c 14 370
75d 23 350 73 409
75f 36 380 12 497
- ------------------------------------------------------------------------------------------------------------------------------
76 232 366 125 484 38 592
80 88 396 90 509 8 558 6 800
83 144 457 84 550
86 66 568 66 653
89 125 459 19 627
- ------------------------------------------------------------------------------------------------------------------------------
92 63 365 95 456
103 120 523
105 19 464 81 552
106 68 418 96 496
110 49 619 15 778
- ------------------------------------------------------------------------------------------------------------------------------
112 48 555 35 638
113 48 442 36 500 16 530
114 33 595 26 695
118 24 495 29 601 5 725
123 32 412 72 496 6 625
- ------------------------------------------------------------------------------------------------------------------------------
125 72 432
132 88 450 12 495
136 25 475 10 565 1 685
138 21 550 4 700
</TABLE>
<PAGE>
5 BEDROOM NUMBER
Control Avg Rent of
Number #Units per mo. ($) Elevators
- -------------------------------------------------------------------
8
8a
8b
8c
8d
- -------------------------------------------------------------------
10
10a
10b
10c
13
- -------------------------------------------------------------------
14
14a
14b
14c
18
- -------------------------------------------------------------------
21
24 10
32 1 1450
35
35a
35b
- -------------------------------------------------------------------
45
48
57
60
- -------------------------------------------------------------------
61
61a
61b
61c
61d
61e 2
- -------------------------------------------------------------------
62 2
64
67
70
71
- -------------------------------------------------------------------
75
75a
75b
75c
75d
75f
- -------------------------------------------------------------------
76
80
83
86
89
- -------------------------------------------------------------------
92
103
105
106
110
- -------------------------------------------------------------------
112
113
114
118
123
- -------------------------------------------------------------------
125
132
136
138
A-10
<PAGE>
AGGREGATE POOL
DISTRIBUTION OF CUT-OFF DATE PRINCIPAL BALANCES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
BALANCE MORTGAGE DATE DATE DATE DATE DATE
DISTRIBUTION LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- ---------------------------- ----------- ----------------- ------------ -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
$ 500,000 - $ 999,999 1 $ 869,138 0.08% $ 869,138 $ 869,138 $ 869,138
1,000,000 - 1,999,999 22 34,711,286 3.01 1,049,145 1,995,846 1,577,786
2,000,000 - 2,999,999 15 36,295,522 3.15 2,024,303 2,998,500 2,419,701
3,000,000 - 3,999,999 18 61,584,647 5.35 3,098,649 3,956,022 3,421,369
4,000,000 - 4,999,999 18 83,234,257 7.23 4,034,290 4,993,661 4,624,125
5,000,000 - 5,999,999 7 39,941,631 3.47 5,197,262 5,997,104 5,705,947
6,000,000 - 6,999,999 11 71,315,608 6.19 6,028,410 6,994,302 6,483,237
7,000,000 - 7,999,999 8 59,364,057 5.15 7,103,566 7,788,279 7,420,507
8,000,000 - 8,999,999 3 25,726,434 2.23 8,093,378 8,850,000 8,575,478
9,000,000 - 9,999,999 5 47,365,594 4.11 9,231,694 9,992,305 9,473,119
10,000,000 - 11,999,999 6 65,173,851 5.66 10,104,511 11,850,637 10,862,309
12,000,000 - 13,999,999 5 65,367,148 5.67 12,231,790 13,992,523 13,073,430
14,000,000 - 16,999,999 4 60,679,367 5.27 14,493,350 15,949,087 15,169,842
17,000,000 - 19,999,999 2 35,370,331 3.07 17,420,000 17,950,331 17,685,165
20,000,000 - 24,999,999 4 89,040,863 7.73 20,162,442 24,888,157 22,260,216
25,000,000 - 49,999,999 7 233,146,887 20.24 25,984,904 46,511,317 33,306,698
50,000,000 - 80,000,000 2 142,835,426 12.40 62,835,426 80,000,000 71,417,713
--- -------------- ------
Total/Avg./Wtd.Avg./
Min/Max: 138 $1,152,022,048 100.00% $ 869,138 $80,000,000 $ 8,347,986
=== ============== ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
BALANCE COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
DISTRIBUTION RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- ---------------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 500,000 - $ 999,999 1.21x 1.21x 1.21x 8.260% 118.0 79.01% 79.01% 79.01%
1,000,000 - 1,999,999 1.01 1.90 1.41 7.853 119.2 43.07 82.93 68.32
2,000,000 - 2,999,999 1.21 1.53 1.30 7.934 122.0 54.44 80.18 73.67
3,000,000 - 3,999,999 1.20 2.17 1.37 8.067 117.0 58.27 80.40 70.17
4,000,000 - 4,999,999 1.15 1.82 1.37 7.719 115.6 45.10 80.05 70.31
5,000,000 - 5,999,999 1.19 1.34 1.25 8.036 118.3 63.13 79.97 74.68
6,000,000 - 6,999,999 1.20 1.78 1.36 8.051 119.3 54.89 79.91 70.97
7,000,000 - 7,999,999 1.20 1.62 1.32 7.976 115.9 43.29 78.27 66.24
8,000,000 - 8,999,999 1.20 1.68 1.38 8.068 118.3 57.40 72.72 65.96
9,000,000 - 9,999,999 1.19 1.63 1.42 8.031 128.0 58.09 80.98 68.83
10,000,000 - 11,999,999 1.23 1.90 1.43 7.822 108.6 52.28 78.21 69.85
12,000,000 - 13,999,999 1.20 1.60 1.31 7.989 129.8 58.07 79.95 70.87
14,000,000 - 16,999,999 1.28 1.69 1.42 8.191 112.8 53.46 79.33 67.86
17,000,000 - 19,999,999 1.22 1.25 1.23 7.808 116.5 71.39 73.63 72.53
20,000,000 - 24,999,999 1.19 1.39 1.29 7.556 114.9 46.00 86.42 70.36
25,000,000 - 49,999,999 1.23 1.90 1.42 7.987 116.0 49.51 74.44 66.70
50,000,000 - 80,000,000 1.36 1.43 1.40 7.647 117.1 60.38 72.73 65.81
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.37x 7.896% 117.4 43.07% 86.42% 68.84%
</TABLE>
A-11
<PAGE>
LOAN GROUP 1
DISTRIBUTION OF CUT-OFF DATE PRINCIPAL BALANCES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
BALANCE MORTGAGE DATE DATE DATE DATE DATE
DISTRIBUTION LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- ---------------------------- ----------- -------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
$ 1,000,000 - $ 1,999,999 17 $ 26,874,306 3.01% $ 1,049,145 $ 1,995,846 $ 1,580,842
2,000,000 - 2,999,999 8 19,944,681 2.24 2,024,303 2,998,500 2,493,085
3,000,000 - 3,999,999 14 47,064,309 5.27 3,098,649 3,896,785 3,361,736
4,000,000 - 4,999,999 12 55,217,016 6.19 4,034,290 4,993,661 4,601,418
5,000,000 - 5,999,999 3 17,531,921 1.96 5,597,376 5,997,104 5,843,974
6,000,000 - 6,999,999 9 58,300,543 6.53 6,082,695 6,994,302 6,477,838
7,000,000 - 7,999,999 7 52,021,532 5.83 7,103,566 7,788,279 7,431,647
8,000,000 - 8,999,999 3 25,726,434 2.88 8,093,378 8,850,000 8,575,478
9,000,000 - 9,999,999 3 28,692,755 3.22 9,296,027 9,992,305 9,564,252
10,000,000 - 11,999,999 6 65,173,851 7.30 10,104,511 11,850,637 10,862,309
12,000,000 - 13,999,999 3 39,543,604 4.43 12,427,897 13,992,523 13,181,201
14,000,000 - 16,999,999 3 45,685,417 5.12 14,493,350 15,949,087 15,228,472
17,000,000 - 19,999,999 1 17,420,000 1.95 17,420,000 17,420,000 17,420,000
20,000,000 - 24,999,999 2 43,990,264 4.93 20,990,264 23,000,000 21,995,132
25,000,000 - 49,999,999 6 206,220,186 23.11 25,984,904 46,511,317 34,370,031
50,000,000 - 80,000,000 2 142,835,426 16.01 62,835,426 80,000,000 71,417,713
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 99 $892,242,246 100.00% $ 1,049,145 $80,000,000 $ 9,012,548
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
BALANCE COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
DISTRIBUTION RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- ---------------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 1,000,000 - $ 1,999,999 1.01x 1.90x 1.43x 7.816% 119.8 43.07% 82.93% 67.07%
2,000,000 - 2,999,999 1.25 1.48 1.30 8.059 117.7 67.48 80.18 73.61
3,000,000 - 3,999,999 1.20 2.17 1.38 8.152 117.6 58.27 74.54 67.39
4,000,000 - 4,999,999 1.15 1.82 1.33 7.885 116.8 45.10 80.05 69.06
5,000,000 - 5,999,999 1.19 1.34 1.26 8.112 119.0 63.13 78.12 70.39
6,000,000 - 6,999,999 1.25 1.78 1.39 8.097 119.6 54.89 79.91 70.90
7,000,000 - 7,999,999 1.20 1.62 1.34 7.948 115.7 43.29 78.27 65.23
8,000,000 - 8,999,999 1.20 1.68 1.38 8.068 118.3 57.40 72.72 65.96
9,000,000 - 9,999,999 1.35 1.63 1.49 8.197 134.8 58.09 70.18 62.21
10,000,000 - 11,999,999 1.23 1.90 1.43 7.822 108.6 52.28 78.21 69.85
12,000,000 - 13,999,999 1.20 1.60 1.37 8.060 118.4 58.07 77.74 67.08
14,000,000 - 16,999,999 1.28 1.69 1.46 8.320 118.0 53.46 72.50 64.10
17,000,000 - 19,999,999 1.25 1.25 1.25 8.260 117.0 71.39 71.39 71.39
20,000,000 - 24,999,999 1.27 1.39 1.33 7.952 119.0 46.00 71.96 58.39
25,000,000 - 49,999,999 1.23 1.90 1.43 8.059 116.0 49.51 74.44 66.01
50,000,000 - 80,000,000 1.36 1.43 1.40 7.647 117.1 60.38 72.73 65.81
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.39x 7.976% 117.2 43.07% 82.93% 66.64%
</TABLE>
A-12
<PAGE>
LOAN GROUP 2
DISTRIBUTION OF CUT-OFF DATE PRINCIPAL BALANCES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
BALANCE MORTGAGE DATE DATE DATE DATE DATE
DISTRIBUTION LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- ---------------------------- ----------- --------------- ------------ -------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
$ 500,000 - $ 999,999 1 $ 869,138 0.33% $ 869,138 $ 869,138 $ 869,138
1,000,000 - 1,999,999 5 7,836,979 3.02 1,088,864 1,958,977 1,567,396
2,000,000 - 2,999,999 7 16,350,841 6.29 2,046,062 2,744,979 2,335,834
3,000,000 - 3,999,999 4 14,520,338 5.59 3,343,732 3,956,022 3,630,085
4,000,000 - 4,999,999 6 28,017,242 10.78 4,057,037 4,986,042 4,669,540
5,000,000 - 5,999,999 4 22,409,710 8.63 5,197,262 5,797,463 5,602,427
6,000,000 - 6,999,999 2 13,015,066 5.01 6,028,410 6,986,655 6,507,533
7,000,000 - 7,999,999 1 7,342,525 2.83 7,342,525 7,342,525 7,342,525
9,000,000 - 9,999,999 2 18,672,839 7.19 9,231,694 9,441,145 9,336,419
12,000,000 - 13,999,999 2 25,823,544 9.94 12,231,790 13,591,754 12,911,772
14,000,000 - 16,999,999 1 14,993,950 5.77 14,993,950 14,993,950 14,993,950
17,000,000 - 19,999,999 1 17,950,331 6.91 17,950,331 17,950,331 17,950,331
20,000,000 - 24,999,999 2 45,050,599 17.34 20,162,442 24,888,157 22,525,299
25,000,000 - 49,999,999 1 26,926,701 10.37 26,926,701 26,926,701 26,926,701
-- ------------ -----
Total/Avg./Wtd.Avg./
Min/Max: 39 $259,779,802 100% $ 869,138 $26,926,701 $ 6,661,021
== ============ =====
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
BALANCE COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
DISTRIBUTION RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- ---------------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 500,000 - $ 999,999 1.21x 1.21x 1.21x 8.260% 118.0 79.01% 79.01% 79.01%
1,000,000 - 1,999,999 1.25 1.42 1.33 7.983 117.2 69.06 74.19 72.62
2,000,000 - 2,999,999 1.21 1.53 1.29 7.782 127.2 54.44 79.92 73.73
3,000,000 - 3,999,999 1.21 1.42 1.31 7.793 115.0 77.04 80.40 79.19
4,000,000 - 4,999,999 1.24 1.77 1.44 7.391 113.2 59.92 79.78 72.77
5,000,000 - 5,999,999 1.20 1.29 1.23 7.977 117.7 74.84 79.97 78.03
6,000,000 - 6,999,999 1.20 1.20 1.20 7.845 118.0 64.92 76.78 71.29
7,000,000 - 7,999,999 1.20 1.20 1.20 8.170 118.0 73.43 73.43 73.43
9,000,000 - 9,999,999 1.19 1.45 1.32 7.776 117.5 77.07 80.98 79.00
12,000,000 - 13,999,999 1.20 1.25 1.22 7.880 147.4 73.03 79.95 76.67
14,000,000 - 16,999,999 1.28 1.28 1.28 7.800 97.0 79.33 79.33 79.33
17,000,000 - 19,999,999 1.22 1.22 1.22 7.370 116.0 73.63 73.63 73.63
20,000,000 - 24,999,999 1.19 1.32 1.25 7.170 110.9 76.66 86.42 82.05
25,000,000 - 49,999,999 1.34 1.34 1.34 7.440 116.0 72.03 72.03 72.03
Total/Avg./Wtd.Avg./
Min/Max: 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
</TABLE>
A-13
<PAGE>
AGGREGATE POOL
DISTRIBUTION OF PROPERTY TYPES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
MORTGAGED DATE DATE DATE DATE DATE
PROPERTY TYPE PROPERTIES BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ------------ ----------------- ------------ ------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Retail
Anchored 17 $ 289,664,493 25.14% $2,485,454 $80,000,000 $17,039,088
Unanchored 17 61,018,568 5.30 1,049,145 10,906,598 3,589,328
-- -------------- ------
Retail Subtotal 34 $ 350,683,061 30.44% $1,049,145 $80,000,000 $10,314,208
Office 36 $ 322,053,842 27.96% $1,437,175 $33,640,510 $ 8,945,940
Multifamily 55 259,779,802 22.55 234,383 20,162,442 4,723,269
Lodging 25 105,832,139 9.19 1,557,365 15,949,087 4,233,286
Industrial 21 99,126,076 8.60 843,201 14,493,350 4,720,289
Mobile Home Park 2 4,356,188 0.38 1,986,424 2,369,765 2,178,094
Special Purpose 1 3,896,785 0.34 3,896,785 3,896,785 3,896,785
Self-Storage 1 3,240,153 0.28 3,240,153 3,240,153 3,240,153
Mixed Use 2 3,054,003 0.27 1,433,509 1,620,494 1,527,001
--- -------------- ------
Total/Avg./Wtd.Avg./
Min/Max: 177 $1,152,022,048 100.00% $ 234,383 $80,000,000 $ 6,508,599
=== ============== ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
PROPERTY TYPE RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Retail
Anchored 1.22x 1.63x 1.36x 7.886% 121.1 58.27% 80.18% 68.72%
Unanchored 1.01 1.82 1.37 8.249 118.4 43.29 82.93 66.48
Retail Subtotal 1.01x 1.82x 1.36x 7.949% 120.6 43.29% 82.93% 68.33%
Office 1.19x 1.90x 1.33x 7.794% 115.1 45.10% 79.32% 67.84%
Multifamily 1.19 1.77 1.29 7.619 118.0 54.44 86.42 76.41
Lodging 1.28 1.90 1.65 8.498 112.0 43.07 72.50 58.93
Industrial 1.15 1.78 1.42 8.128 117.9 53.46 78.12 64.93
Mobile Home Park 1.28 1.54 1.40 7.326 113.8 66.21 73.14 69.98
Special Purpose 1.26 1.26 1.26 8.460 119.0 67.19 67.19 67.19
Self-Storage 2.17 2.17 2.17 7.490 117.0 60.79 60.79 60.79
Mixed Use 1.40 1.45 1.42 8.118 116.1 66.67 71.23 69.09
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.37x 7.896% 117.4 43.07% 86.42% 68.84%
</TABLE>
A-14
<PAGE>
LOAN GROUP 1
DISTRIBUTION OF PROPERTY TYPES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
MORTGAGED DATE DATE DATE DATE DATE
PROPERTY TYPE PROPERTIES BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ------------ --------------- ------------ ------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Retail
Anchored 17 $289,664,493 32.46% $2,485,454 $80,000,000 $17,039,088
Unanchored 17 61,018,568 6.84 1,049,145 10,906,598 3,589,328
Retail Subtotal 34 $350,683,061 39.3% $1,049,145 $80,000,000 $10,314,208
--- ------------ ------
Office 36 $322,053,842 36.09% $1,437,175 $33,640,510 $ 8,945,940
Lodging 25 105,832,139 11.86 1,557,365 15,949,087 4,233,286
Industrial 21 99,126,076 11.11 843,201 14,493,350 4,720,289
Mobile Home Park 2 4,356,188 0.49 1,986,424 2,369,765 2,178,094
Special Purpose 1 3,896,785 0.44 3,896,785 3,896,785 3,896,785
Self-Storage 1 3,240,153 0.36 3,240,153 3,240,153 3,240,153
Mixed Use 2 3,054,003 0.34 1,433,509 1,620,494 1,527,001
--- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 122 $892,242,246 100.00% $ 843,201 $80,000,000 $ 7,313,461
=== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
PROPERTY TYPE RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Retail
Anchored 1.22x 1.63x 1.36x 7.886% 121.1 58.27% 80.18% 68.72%
Unanchored 1.01 1.82 1.37 8.249 118.4 43.29 82.93 66.48
Retail Subtotal 1.01x 1.82x 1.36x 7.949% 120.6 43.29% 82.93% 68.33%
Office 1.19x 1.90x 1.33x 7.794% 115.1 45.10% 79.32% 67.84%
Lodging 1.28 1.90 1.65 8.498 112.0 43.07 72.50 58.93
Industrial 1.15 1.78 1.42 8.128 117.9 53.46 78.12 64.93
Mobile Home Park 1.28 1.54 1.40 7.326 113.8 66.21 73.14 69.98
Special Purpose 1.26 1.26 1.26 8.460 119.0 67.19 67.19 67.19
Self-Storage 2.17 2.17 2.17 7.490 117.0 60.79 60.79 60.79
Mixed Use 1.40 1.45 1.42 8.118 116.1 66.67 71.23 69.09
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.39x 7.976% 117.2 43.07% 82.93% 66.64%
</TABLE>
LOAN GROUP 2
DISTRIBUTION OF PROPERTY TYPES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
MORTGAGED DATE DATE DATE DATE DATE
PROPERTY TYPE PROPERTIES BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ------------ --------------- ------------ ----------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Multifamily 55 $259,779,802 100% $234,383 $20,162,442 $4,723,269
-- ------------ ---
Total/Avg./Wtd.Avg./
Min/Max: 55 $259,779,802 100% $234,383 $20,162,442 $4,723,269
== ============ ===
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
PROPERTY TYPE RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Multifamily 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
Total/Avg./Wtd.Avg./
Min/Max: 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
</TABLE>
A-15
<PAGE>
AGGREGATE POOL
RANGE OF DEBT SERVICE COVERAGE RATIOS
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
RANGE OF DEBT NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
SERVICE COVERAGE MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
RATIOS LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- ----------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
1.00 - 1.10x (a) 1 $ 1,451,189 0.13% $1,451,189 $ 1,451,189 $ 1,451,189
1.11 - 1.20 15 130,279,657 11.31 3,128,485 24,888,157 8,685,310
1.21 - 1.30 56 391,759,719 34.01 869,138 42,628,093 6,995,709
1.31 - 1.40 25 258,609,503 22.45 1,088,864 62,835,426 10,344,380
1.41 - 1.50 23 222,532,097 19.32 1,363,602 80,000,000 9,675,309
1.51 - 1.60 6 28,383,013 2.46 1,242,031 13,123,184 4,730,502
1.61 - 1.70 5 40,516,247 3.52 1,246,537 14,493,350 8,103,249
1.71 - 1.80 2 11,027,927 0.96 4,057,037 6,970,891 5,513,964
1.81 - 1.90 4 64,222,542 5.57 1,916,757 46,511,317 16,055,635
2.11 - 2.20 1 3,240,153 0.28 3,240,153 3,240,153 3,240,153
--- -------------- ------
Total/Avg./Wtd.Avg./
Min/Max: 138 $1,152,022,048 100.00% $ 869,138 $80,000,000 $ 8,347,986
=== ============== ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
RANGE OF DEBT SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
SERVICE COVERAGE COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
RATIOS RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1.00 - 1.10x (a) 1.01x 1.01x 1.01x 7.720% 198.0 82.93% 82.93% 82.93%
1.11 - 1.20 1.15 1.20 1.20 7.808 118.5 63.13 86.42 76.39
1.21 - 1.30 1.21 1.30 1.25 8.032 120.2 46.00 80.18 71.42
1.31 - 1.40 1.31 1.40 1.35 7.754 113.7 61.45 80.40 72.33
1.41 - 1.50 1.41 1.49 1.44 7.716 113.0 58.09 78.27 65.34
1.51 - 1.60 1.53 1.60 1.58 7.828 117.5 45.10 79.86 61.46
1.61 - 1.70 1.62 1.69 1.66 8.473 132.3 43.29 65.61 53.94
1.71 - 1.80 1.77 1.78 1.78 7.651 117.7 54.89 71.18 60.88
1.81 - 1.90 1.82 1.90 1.89 8.169 117.2 43.07 52.33 50.00
2.11 - 2.20 2.17 2.17 2.17 7.490 117.0 60.79 60.79 60.79
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.37x 7.896% 117.4 43.07% 86.42% 68.84%
</TABLE>
(a) Loan is a credit tenant lease loan.
LOAN GROUP 1
RANGE OF DEBT SERVICE COVERAGE RATIOS
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
RANGE OF DEBT NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
SERVICE COVERAGE MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
RATIOS LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
1.00 - 1.10x (a) 1 $ 1,451,189 0.16% $1,451,189 $ 1,451,189 $ 1,451,189
1.11 - 1.20 8 56,412,999 6.32 3,128,485 13,992,523 7,051,625
1.21 - 1.30 38 298,315,618 33.43 1,049,145 42,628,093 7,850,411
1.31 - 1.40 19 201,412,698 22.57 1,437,175 62,835,426 10,600,668
1.41 - 1.50 18 198,364,633 22.23 1,363,602 80,000,000 11,020,257
1.51 - 1.60 4 21,335,276 2.39 1,242,031 13,123,184 5,333,819
1.61 - 1.70 5 40,516,247 4.54 1,246,537 14,493,350 8,103,249
1.71 - 1.80 1 6,970,891 0.78 6,970,891 6,970,891 6,970,891
1.81 - 1.90 4 64,222,542 7.20 1,916,757 46,511,317 16,055,635
2.11 - 2.20 1 3,240,153 0.36 3,240,153 3,240,153 3,240,153
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 99 $892,242,246 100.00% $1,049,145 $80,000,000 $ 9,012,548
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
RANGE OF DEBT SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
SERVICE COVERAGE COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
RATIOS RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1.00 - 1.10x (a) 1.01x 1.01x 1.01x 7.720% 198.0 82.93% 82.93% 82.93%
1.11 - 1.20 1.15 1.20 1.19 8.035 118.5 63.13 77.74 71.56
1.21 - 1.30 1.21 1.30 1.26 8.094 119.1 46.00 80.18 70.01
1.31 - 1.40 1.31 1.40 1.35 7.879 114.7 61.45 79.91 71.65
1.41 - 1.50 1.41 1.49 1.44 7.752 113.0 58.09 78.27 64.55
1.51 - 1.60 1.54 1.60 1.59 7.879 117.6 45.10 69.00 56.43
1.61 - 1.70 1.62 1.69 1.66 8.473 132.3 43.29 65.61 53.94
1.71 - 1.80 1.78 1.78 1.78 7.570 117.0 54.89 54.89 54.89
1.81 - 1.90 1.82 1.90 1.89 8.169 117.2 43.07 52.33 50.00
2.11 - 2.20 2.17 2.17 2.17 7.490 117.0 60.79 60.79 60.79
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.39x 7.976% 117.2 43.07% 82.93% 66.64%
</TABLE>
(a) Loan is a credit tenant lease loan.
A-16
<PAGE>
LOAN GROUP 2
RANGE OF DEBT SERVICE COVERAGE RATIOS
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
RANGE OF DEBT NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
SERVICE COVERAGE MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
RATIOS LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ ------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
1.11 - 1.20 7 $ 73,866,659 28.43% $5,797,463 $24,888,157 $10,552,380
1.21 - 1.30 18 93,444,101 35.97 869,138 17,950,331 5,191,339
1.31 - 1.40 6 57,196,805 22.02 1,088,864 26,926,701 9,532,801
1.41 - 1.50 5 24,167,464 9.30 1,795,619 9,441,145 4,833,493
1.51 - 1.60 2 7,047,737 2.71 2,555,385 4,492,352 3,523,868
1.71 - 1.80 1 4,057,037 1.56 4,057,037 4,057,037 4,057,037
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 39 $259,779,802 100.00% $ 869,138 $26,926,701 $ 6,661,021
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
RANGE OF DEBT SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
SERVICE COVERAGE COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
RATIOS RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1.11 - 1.20 1.19x 1.20x 1.20x 7.635% 118.5 64.92% 86.42% 80.09%
1.21 - 1.30 1.21 1.29 1.24 7.832 123.7 54.44 80.05 75.92
1.31 - 1.40 1.31 1.40 1.33 7.314 110.3 72.03 80.40 74.75
1.41 - 1.50 1.42 1.45 1.44 7.427 112.6 59.92 77.07 71.82
1.51 - 1.60 1.53 1.59 1.57 7.674 117.0 74.87 79.86 76.68
1.71 - 1.80 1.77 1.77 1.77 7.790 119.0 71.18 71.18 71.18
Total/Avg./Wtd.Avg./
Min/Max: 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
</TABLE>
AGGREGATE POOL
RANGE OF MORTGAGE INTEREST RATES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
RANGE OF MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
MORTGAGE RATES LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- ----------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
6.5001 - 6.7500 2 $ 6,649,512 0.58% $1,735,996 $ 4,913,515 $ 3,324,756
6.7501 - 7.0000 3 34,940,407 3.03 4,673,453 20,162,442 11,646,802
7.0001 - 7.2500 8 43,519,970 3.78 1,088,864 11,850,637 5,439,996
7.2501 - 7.5000 13 99,706,616 8.65 1,242,031 26,926,701 7,669,740
7.5001 - 7.7500 17 278,931,993 24.21 1,451,189 80,000,000 16,407,764
7.7501 - 8.0000 27 192,797,827 16.74 1,246,537 23,000,000 7,140,660
8.0001 - 8.2500 35 218,686,328 18.98 1,324,345 28,955,362 6,248,181
8.2501 - 8.5000 22 203,060,046 17.63 869,138 46,511,317 9,230,002
8.5001 - 8.7500 9 60,364,119 5.24 1,049,145 15,949,087 6,707,124
8.7501 - 9.0000 2 13,365,230 1.16 3,372,925 9,992,305 6,682,615
-- -------------- ------
Total/Avg./Wtd.Avg./
Min/Max: 138 $1,152,022,048 100.00% $ 869,138 $80,000,000 $ 8,347,986
=== ============== ======
<PAGE>
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
RANGE OF COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
MORTGAGE RATES RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6.5001 - 6.7500 1.45x 1.47x 1.46 x 6.737% 107.0 59.92% 62.00% 60.46%
6.7501 - 7.0000 1.32 1.45 1.35 6.913 103.7 71.03 76.66 75.22
7.0001 - 7.2500 1.28 1.43 1.37 7.122 106.5 70.11 79.12 73.39
7.2501 - 7.5000 1.15 2.17 1.30 7.380 116.7 60.79 86.42 75.63
7.5001 - 7.7500 1.01 1.90 1.41 7.625 116.2 45.10 82.93 66.48
7.7501 - 8.0000 1.20 1.77 1.31 7.902 116.5 46.00 80.05 69.21
8.0001 - 8.2500 1.20 1.62 1.31 8.130 117.9 43.29 80.40 71.04
8.2501 - 8.5000 1.19 1.90 1.45 8.355 121.7 43.07 80.05 64.44
8.5001 - 8.7500 1.21 1.63 1.38 8.638 127.3 58.58 78.54 69.69
8.7501 - 9.0000 1.38 1.49 1.46 8.818 118.7 58.09 73.32 61.93
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.37x 7.896% 117.4 43.07% 86.42% 68.84%
</TABLE>
A-17
<PAGE>
LOAN GROUP 1
RANGE OF MORTGAGE INTEREST RATES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
RANGE OF MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
MORTGAGE RATES LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
6.5001 - 6.7500 1 $ 1,735,996 0.19% $ 1,735,996 $ 1,735,996 $ 1,735,996
6.7501 - 7.0000 1 10,104,511 1.13 10,104,511 10,104,511 10,104,511
7.0001 - 7.2500 6 38,475,085 4.31 1,437,175 11,850,637 6,412,514
7.2501 - 7.5000 8 22,701,435 2.54 1,242,031 4,993,661 2,837,679
7.5001 - 7.7500 12 246,983,209 27.68 1,451,189 80,000,000 20,581,934
7.7501 - 8.0000 16 130,095,228 14.58 1,246,537 23,000,000 8,130,952
8.0001 - 8.2500 25 181,940,469 20.39 1,433,509 28,955,362 7,277,619
8.2501 - 8.5000 19 186,476,964 20.90 1,648,441 46,511,317 9,814,577
8.5001 - 8.7500 9 60,364,119 6.77 1,049,145 15,949,087 6,707,124
8.7501 - 9.0000 2 13,365,230 1.50 3,372,925 9,992,305 6,682,615
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 99 $892,242,246 100.00% $ 1,049,145 $80,000,000 $ 9,012,548
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
RANGE OF COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
MORTGAGE RATES RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6.5001 - 6.7500 1.47x 1.47x 1.47x 6.700% 110.0 62.00% 62.00% 62.00%
6.7501 - 7.0000 1.36 1.36 1.36 6.840 109.0 74.30 74.30 74.30
7.0001 - 7.2500 1.28 1.43 1.38 7.129 106.3 70.11 76.95 72.82
7.2501 - 7.5000 1.15 2.17 1.46 7.386 115.9 60.79 73.71 68.91
7.5001 - 7.7500 1.01 1.90 1.42 7.627 115.9 45.10 82.93 64.79
7.7501 - 8.0000 1.20 1.66 1.31 7.930 118.4 46.00 80.05 66.06
8.0001 - 8.2500 1.20 1.62 1.33 8.134 116.9 43.29 80.18 70.12
8.2501 - 8.5000 1.19 1.90 1.47 8.362 118.0 43.07 76.74 63.51
8.5001 - 8.7500 1.21 1.63 1.38 8.638 127.3 58.58 78.54 69.69
8.7501 - 9.0000 1.38 1.49 1.46 8.818 118.7 58.09 73.32 61.93
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.39x 7.976% 117.2 43.07% 82.93% 66.64%
</TABLE>
LOAN GROUP 2
RANGE OF MORTGAGE INTEREST RATES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
RANGE OF MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
MORTGAGE RATES LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
6.5001 - 6.7500 1 $ 4,913,515 1.89% $4,913,515 $ 4,913,515 $ 4,913,515
6.7501 - 7.0000 2 24,835,896 9.56 4,673,453 20,162,442 12,417,948
7.0001 - 7.2500 2 5,044,886 1.94 1,088,864 3,956,022 2,522,443
7.2501 - 7.5000 5 77,005,181 29.64 2,253,950 26,926,701 15,401,036
7.5001 - 7.7500 5 31,948,784 12.30 2,077,600 13,591,754 6,389,757
7.7501 - 8.0000 11 62,702,599 24.14 1,795,619 14,993,950 5,700,236
8.0001 - 8.2500 10 36,745,859 14.15 1,324,345 7,342,525 3,674,586
8.2501 - 8.5000 3 16,583,082 6.38 869,138 12,231,790 5,527,694
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 39 $259,779,802 100.00% $ 869,138 $26,926,701 $ 6,661,021
== ============ ======
<PAGE>
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
RANGE OF COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
MORTGAGE RATES RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6.5001 - 6.7500 1.45x 1.45x 1.45x 6.750% 106.0 59.92% 59.92% 59.92%
6.7501 - 7.0000 1.32 1.45 1.34 6.943 101.6 71.03 76.66 75.60
7.0001 - 7.2500 1.32 1.35 1.33 7.070 107.9 72.59 79.12 77.71
7.2501 - 7.5000 1.19 1.34 1.26 7.379 117.0 72.03 86.42 77.61
7.5001 - 7.7500 1.19 1.59 1.28 7.607 117.9 74.87 80.98 79.52
7.7501 - 8.0000 1.20 1.77 1.32 7.843 112.6 64.92 79.68 75.76
8.0001 - 8.2500 1.20 1.40 1.24 8.106 122.9 54.44 80.40 75.59
8.2501 - 8.5000 1.21 1.25 1.24 8.275 163.0 73.03 80.05 74.82
Total/Avg./Wtd.Avg./
Min/Max: 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
</TABLE>
A-18
<PAGE>
AGGREGATE POOL
DISTRIBUTION OF AMORTIZATION TYPES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION MORTGAGE DATE DATE DATE DATE DATE
TYPE LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- ----------------- ------------ ------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Balloon 109 $ 720,311,290 62.53% $ 869,138 $33,640,510 $ 6,608,360
Hyperamortizing 28 430,259,568 37.35 1,088,864 80,000,000 15,366,413
Fully Amortizing 1 1,451,189 0.13 1,451,189 1,451,189 1,451,189
--- -------------- ------
Total/Avg./Wtd.Avg./
Min/Max: 138 $1,152,022,048 100.00% $ 869,138 $80,000,000 $ 8,347,986
=== ============== ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TYPE RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balloon 1.15x 2.17x 1.34x 7.954% 119.7 43.29% 80.98% 69.15%
Hyperamortizing 1.19 1.90 1.41 7.800 113.3 43.07 86.42 68.28
Fully Amortizing 1.01 1.01 1.01 7.720 198.0 82.93 82.93 82.93
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.37x 7.896% 117.4 43.07% 86.42% 68.84%
</TABLE>
LOAN GROUP 1
DISTRIBUTION OF AMORTIZATION TYPES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION MORTGAGE DATE DATE DATE DATE DATE
TYPE LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- --------------- ------------ ------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Balloon 75 $525,620,923 58.91% $1,049,145 $33,640,510 $ 7,008,279
Hyperamortizing 23 365,170,134 40.93 1,363,602 80,000,000 15,876,962
Fully Amortizing 1 1,451,189 0.16 1,451,189 1,451,189 1,451,189
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 99 $892,242,246 100.00% $1,049,145 $80,000,000 $ 9,012,548
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TYPE RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balloon 1.15x 2.17x 1.36x 8.039% 119.1 43.29% 80.18% 67.03%
Hyperamortizing 1.23 1.90 1.44 7.887 114.3 43.07 76.95 66.00
Fully Amortizing 1.01 1.01 1.01 7.720 198.0 82.93 82.93 82.93
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.39x 7.976% 117.2 43.07% 82.93% 66.64%
</TABLE>
LOAN GROUP 2
DISTRIBUTION OF AMORTIZATION TYPES
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION MORTGAGE DATE DATE DATE DATE DATE
TYPE LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- --------------- ------------ ------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Balloon 34 $194,690,367 74.94% $ 869,138 $26,926,701 $ 5,726,187
Hyperamortizing 5 65,089,434 25.06 1,088,864 24,888,157 13,017,887
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 39 $259,779,802 100.00% $ 869,138 $26,926,701 $ 6,661,021
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TYPE RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balloon 1.19x 1.77x 1.29x 7.724% 121.5 54.44% 80.98% 74.85%
Hyperamortizing 1.19 1.35 1.26 7.307 107.5 72.59 86.42 81.09
Total/Avg./Wtd.Avg./
Min/Max: 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
</TABLE>
A-19
<PAGE>
AGGREGATE POOL
RANGE OF CURRENT LOAN-TO-VALUE RATIOS
<TABLE>
<CAPTION>
PERCENTAGE
OF
RANGE OF AGGREGATE MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
LOAN-TO-VALUE MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
RATIOS LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- ----------------- ------------ ------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
30.1 - 50.0 5 $ 83,798,666 7.27% $ 1,916,757 $46,511,317 $16,759,733
50.1 - 60.0 12 96,596,121 8.38 2,744,979 14,493,350 8,049,677
60.1 - 65.0 13 137,388,972 11.93 1,735,996 80,000,000 10,568,382
65.1 - 70.0 21 146,107,917 12.68 1,242,031 33,640,510 6,957,520
70.1 - 75.0 52 455,684,003 39.56 1,049,145 62,835,426 8,763,154
75.1 - 80.0 28 182,886,438 15.88 869,138 20,162,442 6,531,658
80.1 - 85.0 6 24,671,775 2.14 1,451,189 9,231,694 4,111,962
85.1 - 90.0 1 24,888,157 2.16 24,888,157 24,888,157 24,888,157
-- -------------- ------
Total/Avg./Wtd.Avg./
Min/Max: 138 $1,152,022,048 100.00% $ 869,138 $80,000,000 $ 8,347,986
=== ============== ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
RANGE OF DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
LOAN-TO-VALUE COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
RATIOS RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
30.1 - 50.0 1.27x 1.90x 1.68x 8.204% 118.2 43.07% 49.51% 47.59%
50.1 - 60.0 1.21 1.90 1.62 8.088 124.7 52.28 59.92 56.24
60.1 - 65.0 1.19 2.17 1.39 7.841 117.8 60.38 64.92 61.73
65.1 - 70.0 1.20 1.66 1.34 7.836 114.9 65.19 69.97 67.24
70.1 - 75.0 1.15 1.77 1.32 7.910 116.6 70.11 74.87 72.68
75.1 - 80.0 1.20 1.53 1.28 7.786 116.1 76.66 79.97 78.30
80.1 - 85.0 1.01 1.31 1.22 7.890 122.2 80.05 82.93 80.63
85.1 - 90.0 1.19 1.19 1.19 7.320 119.0 86.42 86.42 86.42
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.37x 7.896% 117.4 43.07% 86.42% 68.84%
</TABLE>
LOAN GROUP 1
RANGE OF CURRENT LOAN-TO-VALUE RATIOS
<TABLE>
<CAPTION>
PERCENTAGE
OF
RANGE OF AGGREGATE MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
LOAN-TO-VALUE MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
RATIOS LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ ------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
30.1 - 50.0 5 $ 83,798,666 9.39% $1,916,757 $46,511,317 $16,759,733
50.1 - 60.0 10 88,937,626 9.97 3,787,788 14,493,350 8,893,763
60.1 - 65.0 12 131,360,561 14.72 1,735,996 80,000,000 10,946,713
65.1 - 70.0 20 144,312,299 16.17 1,242,031 33,640,510 7,215,615
70.1 - 75.0 38 361,401,871 40.50 1,049,145 62,835,426 9,510,576
75.1 - 80.0 11 74,211,726 8.32 2,189,098 13,992,523 6,746,521
80.1 - 85.0 3 8,219,497 0.92 1,451,189 4,282,853 2,739,832
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 99 $892,242,246 100.00% $1,049,145 $80,000,000 $ 9,012,548
== ============ ======
<PAGE>
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
RANGE OF DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
LOAN-TO-VALUE COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
RATIOS RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
30.1 - 50.0 1.27x 1.90x 1.68x 8.204% 118.2 43.07% 49.51% 47.59%
50.1 - 60.0 1.30 1.90 1.65 8.165 124.1 52.28 58.62 56.09
60.1 - 65.0 1.19 2.17 1.40 7.838 117.8 60.38 64.79 61.59
65.1 - 70.0 1.20 1.66 1.33 7.835 114.9 65.19 69.97 67.22
70.1 - 75.0 1.15 1.48 1.31 7.974 114.6 70.11 74.77 72.60
75.1 - 80.0 1.20 1.41 1.27 8.039 122.7 76.74 79.91 78.02
80.1 - 85.0 1.01 1.27 1.21 7.860 131.3 80.05 82.93 80.60
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.39x 7.976% 117.2 43.07% 82.93% 66.64%
</TABLE>
A-20
<PAGE>
LOAN GROUP 2
RANGE OF CURRENT LOAN-TO-VALUE RATIOS
<TABLE>
<CAPTION>
PERCENTAGE
OF
RANGE OF AGGREGATE MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
LOAN-TO-VALUE MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
RATIOS LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
50.1 - 60.0 2 $ 7,658,494 2.95% $ 2,744,979 $ 4,913,515 $ 3,829,247
60.1 - 65.0 1 6,028,410 2.32 6,028,410 6,028,410 6,028,410
65.1 - 70.0 1 1,795,619 0.69 1,795,619 1,795,619 1,795,619
70.1 - 75.0 14 94,282,132 36.29 1,088,864 26,926,701 6,734,438
75.1 - 80.0 17 108,674,711 41.83 869,138 20,162,442 6,392,630
80.1 - 85.0 3 16,452,278 6.33 3,482,154 9,231,694 5,484,093
85.1 - 90.0 1 24,888,157 9.58 24,888,157 24,888,157 24,888,157
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 39 $259,779,802 100.00% $ 869,138 $26,926,701 $ 6,661,021
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
RANGE OF DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
CUT-OFF DATE SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
LOAN-TO-VALUE COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
RATIOS RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
50.1 - 60.0 1.21x 1.45x 1.36x 7.202% 131.4 54.44% 59.92% 57.96%
60.1 - 65.0 1.20 1.20 1.20 7.920 118.0 64.92 64.92 64.92
65.1 - 70.0 1.42 1.42 1.42 7.900 116.0 69.06 69.06 69.06
70.1 - 75.0 1.20 1.77 1.32 7.664 123.9 71.03 74.87 73.00
75.1 - 80.0 1.20 1.53 1.28 7.614 111.7 76.66 79.97 78.49
80.1 - 85.0 1.19 1.31 1.22 7.905 117.7 80.05 80.98 80.65
85.1 - 90.0 1.19 1.19 1.19 7.320 119.0 86.42 86.42 86.42
Total/Avg./Wtd.Avg./
Min/Max: 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
</TABLE>
A-21
<PAGE>
AGGREGATE POOL
DISTRIBUTION OF MORTGAGED PROPERTIES BY STATE
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
MORTGAGED CUT-OFF DATE DATE DATE DATE DATE
PROPERTY STATE PROPERTIES BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ------------ ----------------- ------------ -------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
California 33 $ 257,522,409 22.35% $ 869,138 $42,628,093 $ 7,803,709
Texas 32 170,965,037 14.84 1,049,145 18,724,030 5,342,657
New York 12 135,788,097 11.79 628,640 62,835,426 11,315,675
Arizona 7 106,162,273 9.22 1,437,175 80,000,000 15,166,039
Indiana 5 68,623,517 5.96 1,916,757 28,955,362 13,724,703
Ohio 7 48,960,798 4.25 1,657,197 13,992,523 6,994,400
Florida 10 47,748,245 4.14 1,799,078 13,591,754 4,774,824
North Carolina 6 37,752,413 3.28 1,965,000 14,493,350 6,292,069
New Jersey 9 32,244,153 2.80 843,201 7,496,174 3,582,684
Mississippi 2 23,067,864 2.00 2,077,600 20,990,264 11,533,932
Missouri 4 20,637,328 1.79 1,806,943 8,850,000 5,159,332
Michigan 4 16,094,862 1.40 1,088,864 9,160,224 4,023,715
New Hampshire 1 15,949,087 1.38 15,949,087 15,949,087 15,949,087
Massachusetts 2 13,790,736 1.20 5,697,357 8,093,378 6,895,368
Oklahoma 3 13,288,731 1.15 3,887,029 5,344,665 4,429,577
Colorado 2 12,427,897 1.08 5,615,014 6,812,883 6,213,948
Virginia 4 12,380,850 1.07 1,995,846 3,896,785 3,095,213
Pennsylvania 3 12,334,523 1.07 3,415,813 4,962,688 4,111,508
Illinois 1 12,098,410 1.05 12,098,410 12,098,410 12,098,410
Tennessee 4 11,502,989 1.00 1,727,078 4,919,468 2,875,747
South Carolina 1 11,191,325 0.97 11,191,325 11,191,325 11,191,325
Maryland 3 9,771,141 0.85 1,451,189 4,821,449 3,257,047
Hawaii 2 7,833,417 0.68 1,735,996 6,097,421 3,916,709
Georgia 3 7,734,324 0.67 1,324,345 3,665,000 2,578,108
Wisconsin 1 6,082,695 0.53 6,082,695 6,082,695 6,082,695
Nevada 1 5,937,441 0.52 5,937,441 5,937,441 5,937,441
Oregon 1 5,286,058 0.46 5,286,058 5,286,058 5,286,058
Alabama 1 4,894,842 0.42 4,894,842 4,894,842 4,894,842
Nebraska 5 4,673,453 0.41 234,383 1,562,553 934,691
Connecticut 2 4,123,922 0.36 2,046,062 2,077,860 2,061,961
Kansas 2 3,993,245 0.35 1,791,969 2,201,276 1,996,622
Minnesota 1 3,244,511 0.28 3,244,511 3,244,511 3,244,511
Delaware 1 3,240,153 0.28 3,240,153 3,240,153 3,240,153
Idaho 1 2,653,725 0.23 2,653,725 2,653,725 2,653,725
West Virginia 1 2,021,580 0.18 2,021,580 2,021,580 2,021,580
--- -------------- ------
Total/Avg./Wtd.Avg./
Min/Max: 177 $1,152,022,048 100.00% $ 234,383 $80,000,000 $ 6,508,599
=== ============== ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
PROPERTY STATE RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
California 1.15x 1.66x 1.34x 7.815% 116.0 45.10% 80.05% 68.47%
Texas 1.19 1.90 1.37 8.001 120.3 49.51 80.05 71.30
New York 1.27 1.62 1.34 7.847 117.3 43.29 80.40 67.02
Arizona 1.20 1.90 1.47 7.779 118.0 49.51 73.90 59.99
Indiana 1.23 1.90 1.29 7.698 108.0 43.07 79.33 75.27
Ohio 1.20 1.90 1.38 8.086 133.3 49.51 78.27 70.74
Florida 1.20 1.54 1.25 7.916 118.2 66.21 79.95 74.77
North Carolina 1.22 1.69 1.42 7.887 117.3 53.46 77.04 66.07
New Jersey 1.25 1.90 1.44 8.086 118.1 49.51 71.76 62.95
Mississippi 1.23 1.39 1.38 7.893 118.9 71.96 79.91 72.68
Missouri 1.20 1.90 1.30 7.944 118.7 49.51 79.86 70.14
Michigan 1.19 1.90 1.30 7.460 118.3 49.51 86.42 80.40
New Hampshire 1.28 1.28 1.28 8.529 116.0 72.50 72.50 72.50
Massachusetts 1.21 1.68 1.49 8.256 119.0 57.40 79.68 66.60
Oklahoma 1.19 1.77 1.37 7.700 117.6 71.18 80.98 77.99
Colorado 1.32 1.32 1.32 8.130 117.0 64.58 64.58 64.58
Virginia 1.26 1.90 1.51 8.078 117.7 49.51 67.19 59.83
Pennsylvania 1.26 1.32 1.29 7.614 114.5 62.11 79.12 70.70
Illinois 1.19 1.19 1.19 7.320 119.0 86.42 86.42 86.42
Tennessee 1.27 1.90 1.73 7.956 112.2 49.51 80.18 57.34
South Carolina 1.40 1.40 1.40 8.750 83.0 70.39 70.39 70.39
Maryland 1.01 1.42 1.31 8.089 129.7 64.79 82.93 71.56
Hawaii 1.36 1.47 1.38 7.836 117.0 62.00 79.91 75.94
Georgia 1.21 1.40 1.26 8.170 138.6 54.44 73.57 65.75
Wisconsin 1.45 1.45 1.45 8.250 80.0 70.73 70.73 70.73
Nevada 1.25 1.25 1.25 8.110 119.0 78.12 78.12 78.12
Oregon 1.90 1.90 1.90 8.370 118.0 49.51 49.51 49.51
Alabama 1.24 1.24 1.24 8.050 118.0 79.59 79.59 79.59
Nebraska 1.45 1.45 1.45 6.760 104.0 71.03 71.03 71.03
Connecticut 1.25 1.25 1.25 7.961 117.5 78.69 79.92 79.31
Kansas 1.90 1.90 1.90 8.370 118.0 49.51 49.51 49.51
Minnesota 1.90 1.90 1.90 8.370 118.0 49.51 49.51 49.51
Delaware 2.17 2.17 2.17 7.490 117.0 60.79 60.79 60.79
Idaho 1.32 1.32 1.32 7.810 119.0 72.31 72.31 72.31
West Virginia 1.90 1.90 1.90 8.370 118.0 49.51 49.51 49.51
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.37x 7.896% 117.4 43.07% 86.42% 68.84%
</TABLE>
A-22
<PAGE>
LOAN GROUP 1
DISTRIBUTION OF MORTGAGED PROPERTIES BY STATE
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
MORTGAGED CUT-OFF DATE DATE DATE DATE DATE
PROPERTY STATE PROPERTIES BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ------------ -------------- ------------ ------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
California 29 $243,752,369 27.32% $ 1,166,996 $42,628,093 $ 8,405,254
New York 6 126,332,040 14.16 1,843,518 62,835,426 21,055,340
Texas 20 105,031,862 11.77 1,049,145 15,242,981 5,251,593
Arizona 6 103,908,323 11.65 1,437,175 80,000,000 17,318,054
Ohio 6 36,729,008 4.12 1,657,197 13,992,523 6,121,501
New Jersey 9 32,244,153 3.61 843,201 7,496,174 3,582,684
Indiana 2 30,872,119 3.46 1,916,757 28,955,362 15,436,060
Florida 7 21,972,574 2.46 1,799,078 7,500,000 3,138,939
Mississippi 1 20,990,264 2.35 20,990,264 20,990,264 20,990,264
Missouri 3 18,081,943 2.03 1,806,943 8,850,000 6,027,314
North Carolina 2 16,458,350 1.84 1,965,000 14,493,350 8,229,175
New Hampshire 1 15,949,087 1.79 15,949,087 15,949,087 15,949,087
Colorado 2 12,427,897 1.39 5,615,014 6,812,883 6,213,948
Virginia 4 12,380,850 1.39 1,995,846 3,896,785 3,095,213
Tennessee 4 11,502,989 1.29 1,727,078 4,919,468 2,875,747
South Carolina 1 11,191,325 1.25 11,191,325 11,191,325 11,191,325
Maryland 3 9,771,141 1.10 1,451,189 4,821,449 3,257,047
Pennsylvania 2 8,378,501 0.94 3,415,813 4,962,688 4,189,250
Massachusetts 1 8,093,378 0.91 8,093,378 8,093,378 8,093,378
Hawaii 2 7,833,417 0.88 1,735,996 6,097,421 3,916,709
Wisconsin 1 6,082,695 0.68 6,082,695 6,082,695 6,082,695
Nevada 1 5,937,441 0.67 5,937,441 5,937,441 5,937,441
Oregon 1 5,286,058 0.59 5,286,058 5,286,058 5,286,058
Kansas 2 3,993,245 0.45 1,791,969 2,201,276 1,996,622
Georgia 1 3,665,000 0.41 3,665,000 3,665,000 3,665,000
Minnesota 1 3,244,511 0.36 3,244,511 3,244,511 3,244,511
Delaware 1 3,240,153 0.36 3,240,153 3,240,153 3,240,153
Idaho 1 2,653,725 0.30 2,653,725 2,653,725 2,653,725
Michigan 1 2,216,251 0.25 2,216,251 2,216,251 2,216,251
West Virginia 1 2,021,580 0.23 2,021,580 2,021,580 2,021,580
--- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 122 $892,242,246 100.00% $ 843,201 $80,000,000 $ 7,313,461
=== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
PROPERTY STATE RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
California 1.15x 1.66x 1.34x 7.830% 116.1 45.10% 80.05% 68.65%
New York 1.27 1.62 1.35 7.835 117.4 43.29 74.76 66.27
Texas 1.19 1.90 1.39 8.172 122.3 49.51 79.32 69.12
Arizona 1.20 1.90 1.47 7.785 118.0 49.51 70.11 59.69
Ohio 1.20 1.90 1.43 8.022 118.0 49.51 78.27 69.98
New Jersey 1.25 1.90 1.44 8.086 118.1 49.51 71.76 62.95
Indiana 1.23 1.90 1.27 8.107 117.1 43.07 74.44 72.49
Florida 1.25 1.54 1.29 8.176 117.7 66.21 71.96 70.27
Mississippi 1.39 1.39 1.39 7.910 119.0 71.96 71.96 71.96
Missouri 1.20 1.90 1.27 8.001 118.9 49.51 72.72 68.77
North Carolina 1.25 1.69 1.64 8.471 118.8 53.46 71.39 55.60
New Hampshire 1.28 1.28 1.28 8.529 116.0 72.50 72.50 72.50
Colorado 1.32 1.32 1.32 8.130 117.0 64.58 64.58 64.58
Virginia 1.26 1.90 1.51 8.078 117.7 49.51 67.19 59.83
Tennessee 1.27 1.90 1.73 7.956 112.2 49.51 80.18 57.34
South Carolina 1.40 1.40 1.40 8.750 83.0 70.39 70.39 70.39
Maryland 1.01 1.42 1.31 8.089 129.7 64.79 82.93 71.56
Pennsylvania 1.26 1.28 1.27 7.894 118.0 62.11 69.90 66.72
Massachusetts 1.68 1.68 1.68 8.500 119.0 57.40 57.40 57.40
Hawaii 1.36 1.47 1.38 7.836 117.0 62.00 79.91 75.94
Wisconsin 1.45 1.45 1.45 8.250 80.0 70.73 70.73 70.73
Nevada 1.25 1.25 1.25 8.110 119.0 78.12 78.12 78.12
Oregon 1.90 1.90 1.90 8.370 118.0 49.51 49.51 49.51
Kansas 1.90 1.90 1.90 8.370 118.0 49.51 49.51 49.51
Georgia 1.25 1.25 1.25 8.260 117.0 71.39 71.39 71.39
Minnesota 1.90 1.90 1.90 8.370 118.0 49.51 49.51 49.51
Delaware 2.17 2.17 2.17 7.490 117.0 60.79 60.79 60.79
Idaho 1.32 1.32 1.32 7.810 119.0 72.31 72.31 72.31
Michigan 1.90 1.90 1.90 8.370 118.0 49.51 49.51 49.51
West Virginia 1.90 1.90 1.90 8.370 118.0 49.51 49.51 49.51
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.39x 7.976% 117.2 43.07% 82.93% 66.64%
</TABLE>
A-23
<PAGE>
LOAN GROUP 2
DISTRIBUTION OF MORTGAGED PROPERTIES BY STATE
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
MORTGAGED CUT-OFF DATE DATE DATE DATE DATE
PROPERTY STATE PROPERTIES BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ------------ -------------- ------------ ------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Texas 12 $ 65,933,175 25.38% $ 1,121,946 $18,724,030 $ 5,494,431
Indiana 3 37,751,397 14.53 2,595,005 20,162,442 12,583,799
Florida 3 25,775,671 9.92 5,197,262 13,591,754 8,591,890
North Carolina 4 21,294,063 8.20 3,343,732 7,504,236 5,323,516
Michigan 3 13,878,611 5.34 1,088,864 9,160,224 4,626,204
California 4 13,770,040 5.30 869,138 6,028,410 3,442,510
Oklahoma 3 13,288,731 5.12 3,887,029 5,344,665 4,429,577
Ohio 1 12,231,790 4.71 12,231,790 12,231,790 12,231,790
Illinois 1 12,098,410 4.66 12,098,410 12,098,410 12,098,410
New York 6 9,456,058 3.64 628,640 3,738,431 1,576,010
Massachusetts 1 5,697,357 2.19 5,697,357 5,697,357 5,697,357
Alabama 1 4,894,842 1.88 4,894,842 4,894,842 4,894,842
Nebraska 5 4,673,453 1.80 234,383 1,562,553 934,691
Connecticut 2 4,123,922 1.59 2,046,062 2,077,860 2,061,961
Georgia 2 4,069,324 1.57 1,324,345 2,744,979 2,034,662
Pennsylvania 1 3,956,022 1.52 3,956,022 3,956,022 3,956,022
Missouri 1 2,555,385 0.98 2,555,385 2,555,385 2,555,385
Arizona 1 2,253,950 0.87 2,253,950 2,253,950 2,253,950
Mississippi 1 2,077,600 0.80 2,077,600 2,077,600 2,077,600
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 55 $259,779,802 100.00% $ 234,383 $20,162,442 $ 4,723,269
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
PROPERTY STATE RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Texas 1.20x 1.59x 1.33x 7.730% 117.0 69.06% 80.05% 74.78%
Indiana 1.25 1.32 1.30 7.364 100.5 74.14 79.33 77.55
Florida 1.20 1.24 1.21 7.693 118.7 76.78 79.95 78.61
North Carolina 1.22 1.42 1.25 7.436 116.2 73.63 77.04 74.17
Michigan 1.19 1.35 1.20 7.315 118.4 72.59 86.42 85.33
California 1.20 1.45 1.30 7.544 113.9 59.92 79.01 65.31
Oklahoma 1.19 1.77 1.37 7.700 117.6 71.18 80.98 77.99
Ohio 1.25 1.25 1.25 8.280 179.0 73.03 73.03 73.03
Illinois 1.19 1.19 1.19 7.320 119.0 86.42 86.42 86.42
New York 1.29 1.31 1.30 8.011 116.0 74.84 80.40 77.04
Massachusetts 1.21 1.21 1.21 7.910 119.0 79.68 79.68 79.68
Alabama 1.24 1.24 1.24 8.050 118.0 79.59 79.59 79.59
Nebraska 1.45 1.45 1.45 6.760 104.0 71.03 71.03 71.03
Connecticut 1.25 1.25 1.25 7.961 117.5 78.69 79.92 79.31
Georgia 1.21 1.40 1.27 8.088 158.1 54.44 73.57 60.67
Pennsylvania 1.32 1.32 1.32 7.020 107.0 79.12 79.12 79.12
Missouri 1.53 1.53 1.53 7.540 117.0 79.86 79.86 79.86
Arizona 1.27 1.27 1.27 7.500 116.0 73.90 73.90 73.90
Mississippi 1.23 1.23 1.23 7.720 118.0 79.91 79.91 79.91
Total/Avg./Wtd.Avg./
Min/Max: 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
</TABLE>
A-24
<PAGE>
AGGREGATE POOL
PREPAYMENT PROVISIONS*
<TABLE>
<CAPTION>
PREPAYMENT RESTRICTIONS OCT-99 OCT-00 OCT-01 OCT-02 OCT-03 OCT-04 OCT-05
- ---------------------------- ------------- ------------- ------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Locked out ................ 99.06% 99.05% 33.44% 8.18% 1.60% 0.00% 0.00%
Defeasance ................ 0.00 0.00 66.56 88.90 95.07 96.67 96.68
Yield Maintenance ......... 0.94 0.95 0.00 2.92 3.33 3.33 3.32
- ---------------------------- -------- -------- -------- -------- -------- -------- --------
Sub Total ................. 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Open ...................... 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
- ---------------------------- -------- -------- -------- -------- -------- -------- --------
Total ..................... 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM).................. 1,152.02 1,142.74 1,131.83 1,119.79 1,106.73 1,092.68 1,077.22
% of Initial UPB .......... 100.00% 99.19% 98.25% 97.20% 96.07% 94.85% 93.51%
</TABLE>
<TABLE>
<CAPTION>
PREPAYMENT RESTRICTIONS OCT-06 OCT-07 OCT-08 OCT-09 OCT-10 OCT-11
- ---------------------------- ------------ ------------ ------------ ------------ ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Locked out ................ 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Defeasance ................ 96.63 93.59 98.26 100.00 100.00 100.00
Yield Maintenance ......... 3.37 3.36 0.00 0.00 0.00 0.00
- ----------------------------- -------- -------- -------- -------- ------ ------
Sub Total ................. 100.00% 96.95% 98.26% 100.00% 100.00% 100.00%
Open ...................... 0.00% 3.05% 1.74% 0.00% 0.00% 0.00%
- ----------------------------- -------- -------- -------- -------- ------ ------
Total ..................... 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM).................. 1,045.10 1,027.36 901.09 27.56 24.99 23.93
% of Initial UPB .......... 90.72% 89.18% 78.22% 2.39% 2.17% 2.08%
</TABLE>
*Assuming no prepayments and the maturity assumptions described under "Yield
and Maturity Considerations" in this prospectus supplement.
A-25
<PAGE>
LOAN GROUP 1
PREPAYMENT PROVISIONS*
<TABLE>
<CAPTION>
PREPAYMENT RESTRICTIONS OCT-99 OCT-00 OCT-01 OCT-02 OCT-03 OCT-04 OCT-05
- ---------------------------- ----------- ----------- ----------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Locked out ................ 98.78% 98.77% 33.61% 6.83% 1.64% 0.00% 0.00%
Defeasance ................ 0.00 0.00 66.39 89.41 94.60 96.24 96.24
Yield Maintenance ......... 1.22 1.23 0.00 3.76 3.76 3.76 3.76
- ----------------------------- ------ ------ ------ ------ ------ ------ ------
Sub Total ................. 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Open ...................... 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
- ----------------------------- ------ ------ ------ ------ ------ ------ ------
Total ..................... 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM).................. 892.24 885.52 877.42 868.41 858.64 848.08 836.44
% of Initial UPB .......... 100.00% 99.25% 98.34% 97.33% 96.23% 95.05% 93.75%
</TABLE>
<TABLE>
<CAPTION>
PREPAYMENT RESTRICTIONS OCT-06 OCT-07 OCT-08 OCT-09 OCT-10 OCT-11
- ---------------------------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Locked out ................ 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Defeasance ................ 96.17 96.17 97.93 100.00 100.00 100.00
Yield Maintenance ......... 3.83 3.83 0.00 0.00 0.00 0.00
- ----------------------------- ------ ------ ------ ------ ------ ------
Sub Total ................. 100.00% 100.00% 97.93% 100.00% 100.00% 100.00%
Open ...................... 0.00% 0.00% 2.07% 0.00% 0.00% 0.00%
- ----------------------------- ------ ------ ------ ------ ------ ------
Total ..................... 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM).................. 808.45 795.16 715.72 16.65 14.71 14.32
% of Initial UPB .......... 90.61% 89.12% 80.22% 1.87% 1.65% 1.61%
</TABLE>
*Assuming no prepayments and the maturity assumptions described under "Yield
and Maturity Considerations" in this prospectus supplement.
A-26
<PAGE>
LOAN GROUP 2
PREPAYMENT PROVISIONS*
<TABLE>
<CAPTION>
PREPAYMENT RESTRICTIONS OCT-99 OCT-00 OCT-01 OCT-02 OCT-03 OCT-04 OCT-05
- ---------------------------- ------------ ------------ ----------- ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Locked out ................ 100.00% 100.00% 32.84% 12.84% 1.47% 0.00% 0.00%
Defeasance ................ 0.00 0.00 67.16 87.16 96.69 98.18 98.20
Yield Maintenance ......... 0.00 0.00 0.00 0.00 1.84 1.82 1.80
- ----------------------------- ------ ------ ------ ------ ------ ------ ------
Sub Total ................. 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Open ...................... 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
- ----------------------------- ------ ------ ------ ------ ------ ------ ------
Total ..................... 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM).................. 259.78 257.22 254.41 251.37 248.09 244.60 240.78
% of Initial UPB .......... 100.00% 99.01% 97.93% 96.76% 95.50% 94.16% 92.69%
</TABLE>
<TABLE>
<CAPTION>
PREPAYMENT RESTRICTIONS OCT-06 OCT-07 OCT-08 OCT-09 OCT-10 OCT-11
- ---------------------------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Locked out ................ 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Defeasance ................ 98.22 84.75 99.52 100.00 100.00 100.00
Yield Maintenance ......... 1.78 1.76 0.00 0.00 0.00 0.00
- ----------------------------- ------ ------ ------ ------ ------ ------
Sub Total ................. 100.00% 86.51% 99.52% 100.00% 100.00% 100.00%
Open ...................... 0.00% 13.49% 0.48% 0.00% 0.00% 0.00%
- ----------------------------- ------ ------ ------ ------ ------ ------
Total ..................... 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM).................. 236.65 232.20 185.36 10.91 10.29 9.61
% of Initial UPB .......... 91.10% 89.38% 71.35% 4.20% 3.96% 3.70%
</TABLE>
*Assuming no prepayments and the maturity assumptions described under "Yield
and Maturity Considerations" in this prospectus supplement.
A-27
<PAGE>
AGGREGATE POOL
DISTRIBUTION OF REMAINING AMORTIZATION TERMS
<TABLE>
<CAPTION>
PERCENTAGE
OF
RANGE OF AGGREGATE MINIMUM MAXIMUM AVERAGE
REMAINING NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
TERMS (MOS.) LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- ----------------- ------------ -------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Interest Only 1 $ 10,875,000 0.94% $10,875,000 $10,875,000 $10,875,000
191 - 210 1 1,451,189 0.13 1,451,189 1,451,189 1,451,189
231 - 250 2 17,215,427 1.49 4,983,637 12,231,790 8,607,714
271 - 290 2 9,832,983 0.85 4,913,515 4,919,468 4,916,491
291 - 310 23 156,293,506 13.57 1,049,145 46,511,317 6,795,370
331 - 360 109 956,353,943 83.02 869,138 80,000,000 8,773,889
--- -------------- ------
Total/Avg./Wtd.Avg./
Min/Max: 138 $1,152,022,048 100.00% $ 869,138 $80,000,000 $ 8,347,986
=== ============== ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
RANGE OF DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
REMAINING SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TERMS (MOS.) RATIO RATIO RATIO RATE (MOS.) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Interest Only 1.90x 1.90x 1.90x 7.540% 119.0 52.28% 52.28% 52.28%
191 - 210 1.01 1.01 1.01 7.720 198.0 82.93 82.93 82.93
231 - 250 1.25 1.58 1.35 8.098 161.3 45.10 73.03 64.94
271 - 290 1.45 1.82 1.64 7.168 105.5 52.33 59.92 56.12
291 - 310 1.20 2.17 1.56 8.336 113.6 43.07 76.78 61.74
331 - 360 1.15 1.78 1.33 7.832 117.2 43.29 86.42 70.37
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.37x 7.896% 117.4 43.07% 86.42% 68.84%
</TABLE>
LOAN GROUP 1
DISTRIBUTION OF REMAINING AMORTIZATION TERMS
<TABLE>
<CAPTION>
PERCENTAGE
OF
RANGE OF AGGREGATE MINIMUM MAXIMUM AVERAGE
REMAINING NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
TERMS (MOS.) LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ -------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Interest Only 1 $ 10,875,000 1.22% $10,875,000 $10,875,000 $10,875,000
191 - 210 1 1,451,189 0.16 1,451,189 1,451,189 1,451,189
231 - 250 1 4,983,637 0.56 4,983,637 4,983,637 4,983,637
271 - 290 1 4,919,468 0.55 4,919,468 4,919,468 4,919,468
291 - 310 20 142,500,360 15.97 1,049,145 46,511,317 7,125,018
331 - 360 75 727,512,593 81.54 1,166,996 80,000,000 9,700,168
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 99 $892,242,246 100.00% $ 1,049,145 $80,000,000 $ 9,012,548
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
RANGE OF DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
REMAINING SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TERMS (MOS.) RATIO RATIO RATIO RATE (MOS.) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Interest Only 1.90x 1.90x 1.90x 7.540% 119.0 52.28% 52.28% 52.28%
191 - 210 1.01 1.01 1.01 7.720 198.0 82.93 82.93 82.93
231 - 250 1.58 1.58 1.58 7.650 118.0 45.10 45.10 45.10
271 - 290 1.82 1.82 1.82 7.585 105.0 52.33 52.33 52.33
291 - 310 1.21 2.17 1.59 8.389 113.4 43.07 72.50 60.40
331 - 360 1.15 1.78 1.34 7.907 117.9 43.29 80.18 68.29
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.39x 7.976% 117.2 43.07% 82.93% 66.64%
</TABLE>
A-28
<PAGE>
LOAN GROUP 2
RANGE OF REMAINING AMORTIZATION TERMS
<TABLE>
<CAPTION>
PERCENTAGE
OF
RANGE OF AGGREGATE MINIMUM MAXIMUM AVERAGE
REMAINING NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
TERMS (MOS.) LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ -------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
231 - 250 1 $ 12,231,790 4.71% $12,231,790 $12,231,790 $12,231,790
271 - 290 1 4,913,515 1.89 4,913,515 4,913,515 4,913,515
291 - 310 3 13,793,146 5.31 1,088,864 6,986,655 4,597,715
331 - 360 34 228,841,350 88.09 869,138 26,926,701 6,730,628
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 39 $259,779,802 100.00% $ 869,138 $26,926,701 $ 6,661,021
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
RANGE OF DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
REMAINING SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
AMORTIZATION COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TERMS (MOS.) RATIO RATIO RATIO RATE (MOS.) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
231 - 250 1.25x 1.25x 1.25x 8.280% 179.0 73.03% 73.03% 73.03%
271 - 290 1.45 1.45 1.45 6.750 106.0 59.92 59.92 59.92
291 - 310 1.20 1.35 1.25 7.788 115.8 72.59 76.78 75.65
331 - 360 1.19 1.77 1.29 7.593 115.1 54.44 86.42 76.99
Total/Avg./Wtd.Avg./
Min/Max: 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
</TABLE>
AGGREGATE POOL
RANGE OF ORIGINAL TERMS TO MATURITY
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
RANGE OF NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
ORIGINAL TERMS MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
TO MATURITY (MOS) LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- ----------------- ------------ ------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
71 - 90 months 2 $ 17,274,020 1.50% $6,082,695 $11,191,325 $8,637,010
91 - 110 months 16 138,555,213 12.03 1,363,602 33,640,510 8,659,701
111 - 120 months 114 962,072,092 83.51 869,138 80,000,000 8,439,229
131 - 150 months 1 1,799,078 0.16 1,799,078 1,799,078 1,799,078
171 - 190 months 4 30,870,456 2.68 2,744,979 12,231,790 7,717,614
191 - 210 months 1 1,451,189 0.13 1,451,189 1,451,189 1,451,189
--- -------------- ------
Total/Avg./Wtd.Avg./
Min/Max: 138 $1,152,022,048 100.00% $ 869,138 $80,000,000 $8,347,986
=== ============== ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
RANGE OF SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
ORIGINAL TERMS COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TO MATURITY (MOS) RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
71 - 90 months 1.40x 1.45x 1.42x 8.574% 81.9 70.39% 70.73% 70.51%
91 - 110 months 1.28 1.82 1.39 7.251 104.0 52.33 79.33 71.05
111 - 120 months 1.15 2.17 1.37 7.958 117.8 43.07 86.42 68.49
131 - 150 months 1.30 1.30 1.30 8.125 131.0 71.96 71.96 71.96
171 - 190 months 1.21 1.63 1.36 8.460 178.8 54.44 78.54 68.20
191 - 210 months 1.01 1.01 1.01 7.720 198.0 82.93 82.93 82.93
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.37x 7.896% 117.4 43.07% 86.42% 68.84%
</TABLE>
A-29
<PAGE>
LOAN GROUP 1
RANGE OF REMAINING TERMS TO MATURITY
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
RANGE OF NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
REMAINING TERMS MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
TO MATURITY (MOS.) LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ ------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
71 - 90 months 2 $ 17,274,020 1.94% $6,082,695 $11,191,325 $8,637,010
91 - 110 months 11 89,855,830 10.07 1,363,602 33,640,510 8,168,712
111 - 120 months 82 765,968,443 85.85 1,049,145 80,000,000 9,341,079
131 - 150 months 1 1,799,078 0.20 1,799,078 1,799,078 1,799,078
171 - 190 months 2 15,893,687 1.78 6,597,660 9,296,027 7,946,843
191 - 210 months 1 1,451,189 0.16 1,451,189 1,451,189 1,451,189
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 99 $892,242,246 100.00% $1,049,145 $80,000,000 $9,012,548
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
RANGE OF SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
REMAINING TERMS COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TO MATURITY (MOS.) RATIO RATIO RATIO RATE (MOS.) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
71 - 90 months 1.40x 1.45x 1.42x 8.574% 81.9 70.39% 70.73% 70.51%
91 - 110 months 1.30 1.82 1.43 7.282 105.6 52.33 76.95 68.66
111 - 120 months 1.15 2.17 1.39 8.030 117.9 43.07 80.18 66.27
131 - 150 months 1.30 1.30 1.30 8.125 131.0 71.96 71.96 71.96
171 - 190 months 1.25 1.63 1.47 8.676 179.0 58.58 78.54 66.87
191 - 210 months 1.01 1.01 1.01 7.720 198.0 82.93 82.93 82.93
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.39x 7.976% 117.2 43.07% 82.93% 66.64%
</TABLE>
LOAN GROUP 2
RANGE OF REMAINING TERMS TO MATURITY
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
RANGE OF NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
REMAINING TERMS MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
TO MATURITY (MOS.) LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ ------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
91 - 110 months 5 $ 48,699,383 18.75% $3,956,022 $20,162,442 $9,739,877
111 - 120 months 32 196,103,650 75.49 869,138 26,926,701 6,128,239
171 - 190 months 2 14,976,769 5.77 2,744,979 12,231,790 7,488,385
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 39 $259,779,802 100.00% $ 869,138 $26,926,701 $6,661,021
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
RANGE OF SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
REMAINING TERMS COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TO MATURITY (MOS.) RATIO RATIO RATIO RATE (MOS.) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
91 - 110 months 1.28x 1.45x 1.33x 7.193% 101.0 59.92% 79.33% 75.45%
111 - 120 months 1.19 1.77 1.28 7.679 117.5 64.92 86.42 77.17
171 - 190 months 1.21 1.25 1.24 8.231 178.6 54.44 73.03 69.62
Total/Avg./Wtd.Avg./
Min/Max: 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
</TABLE>
A-30
<PAGE>
AGGREGATE POOL
RANGE OF REMAINING TERM TO MATURITY
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
RANGE OF NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
REMAINING TERMS MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
TO MATURITY (MOS.) LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- ---------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
83 - 83 months 1 $ 6,082,695 0.53% $6,082,695 $ 6,082,695 $6,082,695
84 - 120 months 130 1,105,509,111 95.96 869,138 80,000,000 8,503,916
121 - 180 months 6 38,979,053 3.38 1,799,078 12,231,790 6,496,509
181 - 240 months 1 1,451,189 0.13 1,451,189 1,451,189 1,451,189
--- -------------- ------
Total/Avg./Wtd.Avg./
Min/Max: 138 $1,152,022,048 100.00% $ 869,138 $80,000,000 $8,347,986
=== ============== ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
RANGE OF SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
REMAINING TERMS COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TO MATURITY (MOS.) RATIO RATIO RATIO RATE (MOS.) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
83 - 83 months 1.45x 1.45x 1.45x 8.250% 80.0 70.73% 70.73% 70.73%
84 - 120 months 1.15 2.17 1.37 7.882 115.8 43.07 86.42 68.78
121 - 180 months 1.21 1.63 1.35 8.236 164.5 54.44 78.54 69.79
181 - 240 months 1.01 1.01 1.01 7.720 198.0 82.93 82.93 82.93
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.37x 7.896% 117.4 43.07% 86.42% 68.84%
</TABLE>
LOAN GROUP 1
RANGE OF ORIGINAL TERMS TO MATURITY
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
RANGE OF NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
ORIGINAL TERMS MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
TO MATURITY (MOS) LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
83 - 83 months 1 $ 6,082,695 0.68% $6,082,695 $ 6,082,695 $6,082,695
84 - 120 months 93 860,706,079 96.47 1,049,145 80,000,000 9,254,904
121 - 180 months 4 24,002,283 2.69 1,799,078 9,296,027 6,000,571
181 - 240 months 1 1,451,189 0.16 1,451,189 1,451,189 1,451,189
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 99 $892,242,246 100.00% $1,049,145 $80,000,000 $9,012,548
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
RANGE OF SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
ORIGINAL TERMS COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TO MATURITY (MOS) RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
83 - 83 months 1.45x 1.45x 1.45x 8.250% 80.0 70.73% 70.73% 70.73%
84 - 120 months 1.15 2.17 1.39 7.967 116.3 43.07 80.18 66.49
121 - 180 months 1.25 1.63 1.41 8.239 155.7 58.58 78.54 69.90
181 - 240 months 1.01 1.01 1.01 7.720 198.0 82.93 82.93 82.93
Total/Avg./Wtd.Avg./
Min/Max: 1.01x 2.17x 1.39x 7.976% 117.2 43.07% 82.93% 66.64%
</TABLE>
LOAN GROUP 2
RANGE OF ORIGINAL TERMS TO MATURITY
<TABLE>
<CAPTION>
PERCENTAGE
OF
AGGREGATE MINIMUM MAXIMUM AVERAGE
RANGE OF NUMBER OF CUT-OFF CUT-OFF CUT-OFF CUT-OFF
ORIGINAL TERMS MORTGAGE CUT-OFF DATE DATE DATE DATE DATE
TO MATURITY (MOS) LOANS BALANCE BALANCE BALANCE BALANCE BALANCE
- --------------------- ----------- -------------- ------------ ------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
84 - 120 months 37 $244,803,032 94.23% $ 869,138 $26,926,701 $6,616,298
121 - 180 months 2 14,976,769 5.77 2,744,979 12,231,790 7,488,385
-- ------------ ------
Total/Avg./Wtd.Avg./
Min/Max: 39 $259,779,802 100.00% $ 869,138 $26,926,701 $6,661,021
== ============ ======
<CAPTION>
WEIGHTED WEIGHTED
MINIMUM MAXIMUM AVERAGE AVERAGE WEIGHTED
DEBT DEBT DEBT WEIGHTED REMAINING MINIMUM MAXIMUM AVERAGE
RANGE OF SERVICE SERVICE SERVICE AVERAGE TERM TO CUT-OFF CUT-OFF CUT-OFF
ORIGINAL TERMS COVERAGE COVERAGE COVERAGE MORTGAGE MATURITY DATE DATE DATE
TO MATURITY (MOS) RATIO RATIO RATIO RATE (MOS) LTV LTV LTV
- --------------------- ---------- ---------- ---------- ---------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
84 - 120 months 1.19x 1.77x 1.29x 7.582% 114.2 59.92% 86.42% 76.83%
121 - 180 months 1.21 1.25 1.24 8.231 178.6 54.44 73.03 69.62
Total/Avg./Wtd.Avg./
Min/Max: 1.19x 1.77x 1.29x 7.619% 118.0 54.44% 86.42% 76.41%
</TABLE>
A-31
<PAGE>
<TABLE>
<CAPTION>
ANNEX B
<S> <C> <C>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTION DATE STATEMENT
TABLE OF CONTENTS
=====================================================================
STATEMENT SECTIONS PAGE(S)
------------------ -------
<S> <C>
Certificate Distribution Detail 2
Certificate Factor Detail 3
Reconciliation Detail 4
Other Required Information 5
Ratings Detail 6
Current Mortgage Loan and Property Stratification Tables 7 - 9
Mortgage Loan Detail 10
Principal Prepayment Detail 11
Historical Detail 12
Delinquency Loan Detail 13
Specially Serviced Loan Detail 14 - 15
Modified Loan Detail 16
Liquidated Loan Detail 17
=====================================================================
UNDERWRITER UNDERWRITER MASTER SERVICER SPECIAL SERVICER
=============================== =============================== =============================== =================================
Deutsche Bank Securities Inc. Goldman, Sachs & Co. GMAC Commercial Mortgage Corp. GMAC Commercial Mortgage
31 West 52nd Street 85 Broad Street 650 Dresher Road 550 California Street, 12th Floor
New York, NY 10019 New York, New York 10004 Horsham, PA 10944-8015 San Francisco, CA 94104
Contact: Justin Kennedy Contact: Dan Sparks Contact: Gary Severyn Contact: Henry Bieber
Phone Number: (212) 469-5149 Phone Number: (212) 902-2914 Phone Number: (312) 499-5485 Phone Number: (415) 835-9268
=============================== =============================== =============================== =================================
This report has been compiled from information provided to Norwest by various third parties, which may include the
Servicer, Master Servicer, Special Servicer and others. Norwest has not independently confirmed the accuracy of
information received from these third parties and assumes no duty to do so. Norwest expressly disclaims any
responsibility for the accuracy or completeness of information furnished by third parties.
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-1
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE DISTRIBUTION DETAIL
====================================================================================================================================
Realized
Loss/
Additional
Pass- Trust Current
Through Original Beginning Principal Interest Prepayment Fund Total Ending Subordination
Class CUSIP Rate Balance Balance Distribution Distribution Penalties Expenses Distribution Balance Level (1)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
A-1 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
A-2 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
B 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
C 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
D 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
E 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
F 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
G 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
H 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
J 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
K 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
L 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
M 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
N 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
R-I 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
R-II 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
R-III 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00%
====================================================================================================================================
Totals 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
====================================================================================================================================
===============================================================================================
Pass- Original Beginning Ending
Through Notional Notional Interest Prepayment Total Notional
Class CUSIP Rate Amount Amount Distribution Penalties Distribution Amount
===============================================================================================
X 0.000000% 0.00 0.00 0.00 0.00 0.00 0.00
===============================================================================================
(1) Calculated by taking (A) the sum of the ending certificate balance of all classes less (B) the sum of (i) the ending certificate
balance of the designated class and (ii) the ending certificate balance of all classes which are not subordinate to the designated
class and dividing the result by (A).
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-2
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
CERTIFICATE FACTOR DETAIL
====================================================================================================================================
Realized Loss/
Beginning Principal Interest Prepayment Additional Trust Ending
Class CUSIP Balance Distribution Distribution Penalties Fund Expenses Balance
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
A-1A 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
A-1B 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
A-2 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
B 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
C 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
D 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
E 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
F 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
G 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
H 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
J 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
K 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
L 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
M 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
N 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
R-I 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
R-II 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
R-III 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000 0.00000000
====================================================================================================================================
==========================================================================================
Beginning Ending
Notional Interest Prepayment Notional
Class CUSIP Amount Distribution Penalties Amount
==========================================================================================
X 0.00000000 0.00000000 0.00000000 0.00000000
==========================================================================================
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-3
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
RECONCILIATION DETAIL
ADVANCE SUMMARY MASTER SERVICING FEE SUMMARY
<S> <C> <C> <C>
P&I Advances Outstanding 0.00 Current Period Accrued Master Servicing Fees 0.00
Servicing Advances Outstanding 0.00 Less Master Servicing Fees on Delinquent Payments 0.00
Less Reductions to Master Servicing Fees 0.00
Reimbursement for Interest on P&I 0.00 Plus Master Servicing Fees for Delinquent Payments Received 0.00
Advances paid from general collections Plus Adjustments for Prior Master Servicing Calculation 0.00
Total Master Servicing Fees Collected 0.00
Reimbursement for Interest on Servicing 0.00
Advances paid from general collections
CERTIFICATE INTEREST RECONCILIATION
====================================================================================================================================
Net
Aggregate Distributable Unpaid
Accrued Prepayment Distributable Certificate Additional Total Distributable
Certificate Interest Certificate Interest Trust Fund Interest Excess Interest Certificate
Class Interest Shortfall Interest Adjustment Expenses Distribution Interest Distribution Int.
====================================================================================================================================
A-1A 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
A-2B 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
A-2 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
X 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
B 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
C 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
D 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
E 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
F 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
G 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
H 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
J 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
K 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
L 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
M 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
N 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
====================================================================================================================================
Total 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
====================================================================================================================================
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-4
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
OTHER REQUIRED INFORMATION
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
|
Available Distribution Amount 0.00 | Appraisal Reduction
| ===============================================
Aggregate Number of Outstanding Loans 0 | Date
Aggregate Stated Principal Balance of Loans before Distributions 0.00 | Appraisal Appraisal
Aggregate Stated Principal Balance of Loans after Distributions 0.00 | Loan Reductions Reduction
Percentage of Cut-off Date Principal Balance after Distributions 0.0% | Number Effected Effected
| ===============================================
Aggregate Amount of Servicing Fee 0.00 |
Aggregate Amount of Special Servicing Fee 0.00 |
Aggregate Amount of Trustee Fee 0.00 | None
|
Aggregate Additional Trust Fund Expenses 0.00 |
|
Additional Trust Fund Expenses attributed to 0.00 |
Rating Agency charges for Assumptions |
|
Net Balloon Payment Excess (Shortfall) 0.00 |
|
Interest Reserve Account |
Deposits 0.00 |
Withdrawals 0.00 |
|
Specially Serviced Loans not Delinquent | ===============================================
Number of Outstanding Loans 0 | Total
Aggregate Unpaid Principal Balance 0.00 | ===============================================
|
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-5
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
RATINGS DETAIL
============================================================================
Original Ratings Current Ratings (1)
Class CUSIP ------------------------ ------------------------
DCR Fitch Moody's S&P DCR Fitch Moody's S&P
============================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
============================================================================
NR - Designates that the class was not rated by the above agency at the
time of original issuance.
X - Designates that the above rating agency did not rate any classes in
this transaction at the time of original issuance.
N/A - Data not available this period.
1) For any class not rated at the time of original issuance by any particular rating agency, no request has been
made subsequent to issuance to obtain rating information, if any, from such rating agency. The current ratings were
obtained directly from the applicable rating agency within 30 days of the payment date listed above. The ratings
may have changed since they were obtained. Because the ratings may have changed, you may want to obtain current
ratings directly from the rating agencies.
Duff & Phelps Credit Rating Co. Fitch IBCA, Inc. Moody's Investors Service Standard & Poor's Rating Services
55 East Monroe Street One State Street Plaza 99 Church Street 26 Broadway
Chicago, Illinois 60603 New York, New York 10004 New York, New York 10007 New York, New York 10004
(312) 368-3100 (212) 908-0500 (212) 553-0300 (212) 208-8000
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-6
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
CURRENT MORTGAGE LOAN AND PROPERTY STRATIFICATION TABLES
SCHEDULED BALANCE STATE (3)
=============================================================== ===============================================================
% of % of
Scheduled # of Scheduled Agg. WAM Weighted # of Scheduled Agg. WAM Weighted
Balance Loans Balance Bal. (2) WAC Avg DSCR (1) State Props. Balance Bal. (2) WAC Avg DSCR (1)
=============================================================== ===============================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
===============================================================
Totals
===============================================================
===============================================================
Totals
===============================================================
See footnotes on last page of this section.
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-7
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
CURRENT MORTGAGE LOAN AND PROPERTY STRATIFICATION TABLES
DEBT SERVICE COVERAGE RATIO PROPERTY TYPE (3)
============================================================== ==============================================================
Debt
Service % of % of
Coverage # of Scheduled Agg. WAM Weighted Property # of Scheduled Agg. WAM Weighted
Ratio Loans Balance Bal. (2) WAC Avg DSCR (1) Type Props. Balance Bal. (2) WAC Avg DSCR (1)
============================================================== ==============================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
============================================================== ==============================================================
Totals Totals
============================================================== ==============================================================
NOTE RATE SEASONING
============================================================== ==============================================================
% of % of
Note # of Scheduled Agg. WAM Weighted # of Scheduled Agg. WAM Weighted
Rate Loans Balance Bal. (2) WAC Avg DSCR (1) Seasoning Loans Balance Bal. (2) WAC Avg DSCR (1)
============================================================== ==============================================================
============================================================== ==============================================================
Totals Totals
============================================================== ==============================================================
See footnotes on last page of this section.
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-8
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
CURRENT MORTGAGE LOAN AND PROPERTY STRATIFICATION TABLES
ANTICIPATED REMAINING TERM (ARD AND BALLOON LOANS) REMAINING STATED TERM (FULLY AMORTIZING LOANS)
================================================================= =================================================================
Anticipated % of Remaining % of
Remaining # of Scheduled Agg. WAM Weighted Stated # of Scheduled Agg. WAM Weighted
Term (2) Loans Balance Bal. (2) WAC Avg DSCR (1) Term Loans Balance Bal. (2) WAC Avg DSCR (1)
================================================================= =================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
================================================================= =================================================================
Totals Totals
================================================================= =================================================================
REMAINING AMORTIZATION TERM (ARD AND BALLOON LOANS) AGE OF MOST RECENT NOI
================================================================= =================================================================
Age of
Remaining % of Most % of
Amortization # of Scheduled Agg. WAM Weighted Recent # of Scheduled Agg. WAM Weighted
Term Loans Balance Bal. (2) WAC Avg DSCR (1) NOI Loans Balance Bal. (2) WAC Avg DSCR (1)
================================================================= =================================================================
================================================================= =================================================================
Totals Totals
================================================================= =================================================================
(1) Debt Service Coverage Ratios are updated periodically as new NOI figures become available from borrowers on an asset level. In
all cases the most current DSCR provided by the Servicer is used. To the extent that no DSCR is provided by the Servicer,
information from the offering document is used. The Trustee makes no representations as to the accuracy of the data provided by the
borrower for this calculation.
(2) Anticipated Remaining Term and WAM are each calculated based upon the term from the current month to the earlier of the
Anticipated Repayment Date, if applicable, and the maturity date.
(3) Data in this table was calculated by allocating pro- rata the current loan information to the properties based upon the Cut- off
Date Balance of the related mortgage loan as disclosed in the offering document.
Note: (i) "Scheduled Balance" has the meaning assigned thereto in the CSSA Standard Information Package.
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-9
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
MORTGAGE LOAN DETAIL
====================================================================================================================================
=================================================================================================================
Anticipated
Loan Property Interest Principal Gross Repayment Maturity
Number ODCR Type (1) City State Payment Payment Coupon Date Date
=================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
=================================================================================================================
TOTALS
=================================================================================================================
============================================================================================
Neg. Beginning Ending Paid Appraisal Appraisal Res. Mod.
Amort Scheduled Scheduled Thru Reduction Reduction Strat. Code
(Y/N) Balance Balance Date Date Amount (2) (3)
============================================================================================
============================================================================================
============================================================================================
(1) Property Type Code (2) Resolution Strategy Code (3) Modification Code
---------------------- ---------------------------- ---------------------
MF - Multi-Family OF - Office 1 - Modification 6 - DPO 10 - Deed In Lieu Of 1 - Maturity Date
RT - Retail MU - Mixed Use 2 - Foreclosure 7 - REO Foreclosure Extension
HC - Health Care LO - Lodging 3 - Bankruptcy 8 - Resolved 11 - Full Payoff 2 - Amortization Change
IN - Industrial SS - Self Storage 4 - Extension 9 - Pending Return to 12 - Reps and Warranties 3 - Principal Write-Off
WH - Warehouse OT - Other 5 - Note Sale Master Servicer 13 - Other or TBD 4 - Combination
MH - Mobile Home Park
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-10
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL PREPAYMENT DETAIL
====================================================================================================================================
Principal Prepayment Amount Prepayment Penalties
Offering Document ---------------------------------------------- ----------------------------------------------
Loan Number Cross-Reference Payoff Amount Curtailment Amount Prepayment Premium Yield Maintenance Premium
====================================================================================================================================
<S> <C> <C> <C> <C> <C>
====================================================================================================================================
Totals
====================================================================================================================================
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-11
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
HISTORICAL DETAIL
====================================================================================================================================
Delinquencies Prepayments Rate and Maturities
- ------------------------------------------------------------------------------------------------------------------------------------
Distri- Next
bution 30-59 Days 60-89 Days 90 Days or More Foreclosure REO Modifications Curtailments Payoff Weighted Avg.
Date # Balance # Balance # Balance # Balance # Balance # Balance # Amount # Amount Coupon Remit WAM
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
====================================================================================================================================
Note: Foreclosure and REO Totals are excluded from the delinquencies aging categories.
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-12
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
DELINQUENCY LOAN DETAIL
====================================================================================================================================
Offering Status
Document # of Paid Current Outstanding of Resolution Servicing Fore- Current Outstanding Bank-
Loan Cross- Months Through P&I P&I Mortgage Strategy Transfer closure Servicing Servicing ruptcy REO
Number Reference Delinq. Date Advances Advances** Loan (1) Code (2) Date Date Advances Advances Date Date
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
====================================================================================================================================
Totals
====================================================================================================================================
(1) Status of Mortgage Loan (2) Resolution Strategy Code
--------------------------- ----------------------------
1 - Modification 6 - DPO 10 - Deed In Lieu Of 1 - Modification 7 - REO
2 - Foreclosure 7 - REO Foreclosure 2 - Foreclosure 8 - Resolved
3 - Bankruptcy 8 - Resolved 11 - Full Payoff 3 - Bankruptcy 9 - Pending Return to
4 - Extension 9 - Pending Return to 12 - Reps and Warranties 4 - Extension Master Servicer
5 - Note Sale Master Servicer 13 - Other or TBD 5 - Note Sale 10 - Deed In Lieu Of
6 - DPO Foreclosure
** Outstanding P&I Advances include the current period advance
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-13
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
SPECIALLY SERVICED LOAN DETAIL - PART 1
====================================================================================================================================
Offering Remaining
Distri- Document Servicing Resolution Net Amort-
bution Loan Cross- Transfer Strategy Scheduled Property Interest Actual Operating NOI Maturity ization
Date Number Reference Date Code (1) Balance Type (2) State Rate Balance Income Date DSCR Date Term
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
====================================================================================================================================
(1) Resolution Strategy Code (2) Property Type Code
---------------------------- ----------------------
1 - Modification 7 - REO MF - Multi-Family OF - Office
2 - Foreclosure 8 - Resolved RT - Retail MU - Mixed Use
3 - Bankruptcy 9 - Pending Return to HC - Health Care LO - Lodging
4 - Extension Master Servicer IN - Industrial SS - Self Storage
5 - Note Sale 10 - Deed In Lieu Of WH - Warehouse OT - Other
6 - DPO Foreclosure MH - Mobile Home Park
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-14
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
SPECIALLY SERVICED LOAN DETAIL - PART 2
====================================================================================================================================
Offering
Document Resolution Site Other REO
Distribution Loan Cross- Strategy Inspection Phase Appraisal Appraisal Property
Date Number Reference Code (1) Date 1 Date Date Value Revenue Comment
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
====================================================================================================================================
(1) Resolution Strategy Code
----------------------------
1 - Modification 6 - DPO 10 - Deed In Lieu Of
2 - Foreclosure 7 - REO Foreclosure
3 - Bankruptcy 8 - Resolved 11 - Full Payoff
4 - Extension 9 - Pending Return to 12 - Reps and Warranties
5 - Note Sale Master Servicer 13 - Other or TBD
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-15
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
MODIFIED LOAN DETAIL
====================================================================================================================================
Offering
Loan Document Pre-Modification
Number Cross-Reference Balance Modification Date Modification Description
====================================================================================================================================
<S> <C> <C> <C> <C>
====================================================================================================================================
Total
====================================================================================================================================
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-16
<PAGE>
<TABLE>
<CAPTION>
[NORWEST BANKS LOGO] ------------------------------------------
GMAC COMMERCIAL MORTGAGE SECURITIES, INC. For Additional Information, please contact
NORWEST BANK MINNESOTA, N.A. MORTGAGE PASS-THROUGH CERTIFICATES Leslie Gaskill
CORPORATE TRUST SERVICES SERIES 1999-C3 (212) 515-5254
3 NEW YORK PLAZA, 15TH FLOOR Reports Available on the World Wide Web
NEW YORK, NY 10004 @ www.ctslink.com/cmbs
------------------------------------------
PAYMENT DATE: 09/15/1999
RECORD DATE: 08/31/1999
- ------------------------------------------------------------------------------------------------------------------------------------
LIQUIDATED LOAN DETAIL
====================================================================================================================================
Final Gross Net
Recovery Offering Proceeds Proceeds Repur-
Deter- Document as a % of Aggregate Net as a % of chased
Loan mination Cross- Appraisal Appraisal Actual Gross Actual Liquidation Liquidation Actual Realized by Seller
Number Date Reference Date Value Balance Proceeds Balance Expenses* Proceeds Balance Loss (Y/N)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
====================================================================================================================================
Current Total
====================================================================================================================================
Cumulative Total
====================================================================================================================================
* Aggregate liquidation expenses also include outstanding P&I advances and unpaid fees (servicing, trustee, etc.).
- ------------------------------------------------------------------------------------------------------------------------------------
Copyright 1997, Norwest Bank Minnesota, N.A.
</TABLE>
B-17
<PAGE>
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
MORTGAGE PASS-THROUGH CERTIFICATES SERIES 1999-C3
DELINQUENT LOAN STATUS REPORT
AS OF ____________________
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
SHORT NAME SQ FT TOTAL P&I
(WHEN PROPERTY OR PAID THRU SCHEDULED ADVANCES
PROSPECTUS ID APPROPRIATE) TYPE CITY STATE UNITS DATE LOAN BALANCE TO DATE
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
30 DAYS DELINQUENT
60 DAYS DELINQUENT
90 DAYS DELINQUENT
CURRENT & AT SPECIAL SERVICER
<CAPTION>
- ----------------------------------------------------------------------------------------------
TOTAL OTHER CURRENT CURRENT
EXPENSES ADVANCES TOTAL MONTHLY INTEREST MATURITY LTM NOI LTM
TO DATE (TAXES & ESCROW) EXPOSURE P&I RATE DATE DATE NOI
- ----------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C> <C>
<CAPTION>
- ----------------------------------------------------
LTM TRANSFER
DSCR DATE COMMENTS
- ----------------------------------------------------
<C> <C> <C>
</TABLE>
FCL - Foreclosure
LTM - Latest 12 Months either Last Annual or Trailing 12 months
*Workout Strategy should match the CSSA Loan file using abreviated words in
place of a code number such as (FCL - In Foreclosure, MOD - Modification, DPO -
Discount Payoff, NS - Note Sale, BK - Bankrupcy, PP - Payment Plan, TBD - To Be
Determined etc...)
It is possible to combine the status codes if the loan is going in more than one
direction. (i.e. FCL/Mod, BK/Mod, BK/FCL/DPO)
**App - Appraisal, BPO - Broker opinion, Int. - Internal Value
*** How to determine the cap rate is agreed upon by Underwriter and special
servicer - to be provided by a third party.
B-18
<PAGE>
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
MORTGAGE PASS-THROUGH CERTIFICATES SERIES 1999-C3
HISTORICAL LOAN MODIFICATION REPORT
AS OF ____________________
<TABLE>
<CAPTION>
BALANCE WHEN BALANCE AT THE
SENT TO EFFECTIVE DATE # MTHS
PROSPECUTS MOD / EFFECT SPECIAL OF OLD FOR RATE
ID CITY STATE EXTENSION FLAG DATE SERVICER REHABILITATION RATE CHANGE
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
TOTAL FOR ALL LOANS:
TOTAL FOR LOANS IN CURRENT MONTH:
# OF LOANS $BALANCE
MODIFICATIONS: $0.00
MATURITY DATE EXTENSIONS: 0 $0.00
----------------------------------------------------
TOTAL: 0 $0.00
<CAPTION>
(2)
TOTAL # (1) EST. FUTURE
MTHS FOR REALIZED INTEREST LOSS
NEW OLD NEW CHANGE OF LOSS TO TO TRUST $
RATE* OLD P&I NEW P&I** MATURITY MATURITY MOD TRUST $ (RATE REDUCTION) COMMENTS
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>
* The information in these columns is from a particular point in time and should
not change on this report once assigned
(1) Actual principal loss taken by bonds
(2) Expected future loss due to a rate reduction. This is just an estimate
calculated at the time of the modification.
B-19
<PAGE>
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
MORTGAGE PASS-THROUGH CERTIFICATES SERIES 1999-C3
HISTORICAL LOSS ESTIMATE REPORT (REO SOLD OR DISCOUNTED PAYOFF)
AS OF ____________________
<TABLE>
<CAPTION>
LATEST
% APPRAISAL OR EFFECTIVE
PROSPECTUS SHORT PROPERTY RECOVERED BROKER'S DATE OF
ID NAME TYPE CITY STATE FROM SALE OPINION SALE
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
TOTAL ALL LOANS: 0% $ -
Current Month Only:
TOTAL CURRENT MONTH: $ -
<CAPTION>
NET AMT.
SALES RECEIVED SCHEDULED TOTAL P&I TOTAL SERVICING NET
PRICE FROM SALE BALANCE ADVANCED EXPENSES FEES PROCEEDS
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
$ -
$ -
$ -
$ -
$ - $ - $ - $ - $ - $ - $ -
$ - $ - $ - $ - $ - $ - $ -
<CAPTION>
ACTUAL DATE MINOR
LOSSES DATE LOSS ADJ. TOTAL LOSS LOSS %
PASSED PASSED MINOR ADJ. PASSED WITH OF SCHEDULED
THRU THRU TO TRUST THRU ADJUSTMENT BALANCE
- ----------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C>
$ - $ -
$ - $ -
$ - $ -
$ - $ -
$ - $ - $ - 0%
$ - $ -
</TABLE>
B-20
<PAGE>
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
MORTGAGE PASS-THROUGH CERTIFICATES SERIES 1999-C3
REO STATUS REPORT
AS OF ____________________
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
PRO- SHORT NAME SQ FT PAID SCHEDULED TOTAL P&I
SPECTUS (WHEN PROPERTY OR THRU LOAN ADVANCES
ID APPROPRIATE) TYPE CITY STATE UNITS DATE BALANCE TO DATE
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------
VALUE
OTHER USING LOSS
TOTAL ADVANCES CURRENT NOI & APPRAISAL USING 92%
EXPENSES (TAXES & TOTAL MONTHLY CAP RATE VALUATION CAP BPO OR APPR. OR
TO DATE ESCROW) EXPOSURE P&I ASSIGN DATE RATE INTERNAL VALUE** BPO (F)
- ------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
<CAPTION>
- --------------------------------------------------------------------------------------------------
TOTAL
ESTIMATED APPRAISAL REO PENDING
RECOVERY REDUCTION TRANSFER ACQUISITION RESOLUTION
% REALIZED DATE DATE DATE COMMENTS
- --------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C>
</TABLE>
(1) Use the following codes; App. - Appraisal, BPO - Brokers Opinion, Int -
Internal Value
B-21
<PAGE>
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
MORTGAGE PASS-THROUGH CERTIFICATES SERIES 1999-C3
SERVICER WATCH LIST
AS OF ____________________
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------
PROSPECTUS SHORT NAME (WHEN PROPERTY
ID APPROPRIATE) TYPE
- ------------------------------------------------------------------------------
<S> <C> <C>
Total:
<CAPTION>
- -------------------------------------------------------------------------------
SCHEDULED LOAN PAID THRU MATURITY
CITY STATE BALANCE DATE DATE
- -------------------------------------------------------------------------------
<C> <C> <C> <C> <C>
<CAPTION>
- ------------------------------------------------------------------------
LTM
DSCR COMMENT / REASON ON WATCH LIST
- ------------------------------------------------------------------------
<C> <C>
</TABLE>
*LTM - Last twelve months either trailing or last annual
B-22
<PAGE>
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
MORTGAGE PASS-THROUGH CERTIFICATES SERIES 1999-C3
COMPARATIVE FINANCIAL STATUS REPORT
AS OF ____________________
<TABLE>
<CAPTION>
LAST
PROPERTY SCHEDULED PAID ANNUAL
PROSPECTUS INSPECT LOAN THRU DEBT
ID CITY STATE DATE BALANCE DATE SERVICE
<S> <C> <C> <C> <C> <C> <C>
yy/mm
Total: $ $
<CAPTION>
- --------------------------------------
ORIGINAL UNDERWRITING
INFORMATION
- --------------------------------------
BASIS YEAR
- --------------------------------------
Financial
Info as % Total $ (1)
of Date Occ Revenue NOI DSCR
- --------------------------------------
<C> <C> <C> <C> <C>
yy/mm
WA $ $ WA
- --------------------------------------
<CAPTION>
- ---------------------------------------
2ND PRECEDING ANNUAL OPERATING
INFORMATION
- ---------------------------------------
AS OF _______ NORMALIZED
- ---------------------------------------
Financial
Info
as of % Total $ (1)
Date Occ Revenue NOI DSCR
- ---------------------------------------
yy/mm
WA $ $ WA
- ---------------------------------------
<CAPTION>
- ---------------------------------------
PRECEDING ANNUAL OPERATING
INFORMATION
- ---------------------------------------
AS OF _______ NORMALIZED
- ---------------------------------------
Financial
Info
as of % Total $ (1)
Date Occ Revenue NOI DSCR
- ---------------------------------------
yy/mm
WA $ $ WA
- ---------------------------------------
<CAPTION>
- ----------------------------------------
TRAILING FINANCIAL
INFORMATION
- ----------------------------------------
MONTH REPORTED ACTUAL
- ----------------------------------------
FS Start FS End Total $ %
Date Date Revenue NOI DSC
- ----------------------------------------
yy/mm yy/mm
WA $ $ WA
- ----------------------------------------
<CAPTION>
- ---------------------
NET CHANGE
- ---------------------
PRECEDING & BASIS
%
% Total (1)
Occ Revenue DSC
WA $ WA
- ---------------------
<CAPTION>
Received Required
Financial Information: Loans Balance Loans Balance
# % $ % # % $ %
<C> <C> <C> <C> <C>
Current Full Year:
Current Full Yr. received with DSC (less than) 1:
Prior Full Year:
Prior Full Yr. received with DSC (less than) 1:
</TABLE>
(1) DSCR should match to Operating Statement and is calculated in accordance
with the Pooling and Servicing Agreement.
(2) Net change should compare the latest year to the underwriting year
B-23
<PAGE>
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
SERIES 1999-C3
OPERATING STATEMENT ANALYSIS
AS OF ______________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
PROPERTY OVERVIEW
LB Control Number
Current Balance/Paid to Date
Property Name
Property Type
Property Address, City, State
Net Rentable Square Feet
Year Built/Year Renovated
Year of Operations UNDERWRITING 1994 1995 1996 TRAILING
Occupancy Rate *
Average Rental Rate
* OCCUPANCY RATES ARE YEAR END OR THE ENDING DATE OF THE FINANCIAL STATEMENT FOR THE PERIOD.
INCOME: NO. OF MOS.
Number of Mos. PRIOR YEAR CURRENT YR.
Period Ended UNDERWRITING 1994 1995 1996 97 TRAILING** 1996-BASE
Statement Classification BASE LINE NORMALIZED NORMALIZED NORMALIZED AS OF / /97 VARIANCE
Rental Income (Category 1)
Rental Income (Category 2)
Rental Income (Category 3)
Pass Through/Escalations
Other Income
EFFECTIVE GROSS INCOME $0.00 $0.00 $0.00 $0.00 $0.00 %
Normalized - Full year Financial statements that have been reviewed by the
underwriter or Servicer
** Servicer will not be expected to "Normalize" these YTD numbers.
OPERATING EXPENSES:
Real Estate Taxes
Property Insurance
Utilities
General & Administration
Repairs and Maintenance
Management Fees
Payroll & Benefits Expense
Advertising & Marketing
Professional Fees
Other Expenses
Ground Rent
TOTAL OPERATING EXPENSES $0.00 $0.00 $0.00 $0.00 $0.00 %
OPERATING EXPENSE RATIO
NET OPERATING INCOME $0.00 $0.00 $0.00 $0.00 $0.00
Leasing Commissions
Tenant Improvements
Replacement Reserve
TOTAL CAPITAL ITEMS $0.00 $0.00 $0.00 $0.00 $0.00
N.O.I. After Capital Items $0.00 $0.00 $0.00 $0.00 $0.00
DEBT SERVICE (PER SERVICER) $0.00 $0.00 $0.00 $0.00 $0.00
Cash Flow after debt service $0.00 $0.00 $0.00 $0.00 $0.00
DSCR: (NOI/Debt Service)
DSCR: (AFTER RESERVES\CAP EXP.)
Source of Financial Data:
(i.e. operating statements, financial statements, tax return, other)
<PAGE>
<CAPTION>
1996-1995
VARIANCE
<C>
%
%
$0.00
</TABLE>
NOTES AND ASSUMPTIONS:
The years shown above will roll always showing a three year history. 1996 is the
current year financials; 1995 is the prior year financials.
This report may vary depending on the property type and because of the way
information may vary in each borrowers statement.
Rental Income needs to be broken down, differently whenever possible for each
property type as follows: Retail: 1) Base Rent 2)Percentage rents on cashflow
Hotel: 1)Room Revenue 2)Food/Beverage Nursing Home: 1)Private 2) Medicaid 3)
Medicare
INCOME: COMMENT
EXPENSE: COMMENT
CAPITAL ITEMS: COMMENT
B-24
<PAGE>
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
SERIES 1999-C3
NOI ADJUSTMENT WORKSHEET
FOR FISCAL YEAR ENDED _________________
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
PROPERTY OVERVIEW
LB Control Number
Current Balance/Paid to Date
Property Name
Property Type
Property Address, City, State
Net Rentable Square Feet
Year Built/Year Renovated
Year of Operations UNDERWRITING 1994 1995 1996 TRAILING
Occupancy Rate *
Average Rental Rate
* OCCUPANCY RATES ARE YEAR END OR THE ENDING DATE OF THE FINANCIAL STATEMENT FOR THE
PERIOD.
INCOME: NO. OF MOS.
Number of Mos. PRIOR YEAR CURRENT YR.
Period Ended UNDERWRITING 1994 1995 1996 97 TRAILING** 1996-BASE 1996-1995
Statement Classification BASE LINE NORMALIZED NORMALIZED NORMALIZED AS OF / /97 VARIANCE VARIANCE
Rental Income (Category 1)
Rental Income (Category 2)
Rental Income (Category 3)
Pass Through/Escalations
Other Income
EFFECTIVE GROSS INCOME $0.00 $0.00 $0.00 $0.00 $0.00 % %
Normalized - Full year Financial statements that have been reviewed by the
underwriter or Servicer
** Servicer will not be expected to "Normalize" these YTD numbers.
OPERATING EXPENSES:
Real Estate Taxes
Property Insurance
Utilities
General & Administration
Repairs and Maintenance
Management Fees
Payroll & Benefits Expense
Advertising & Marketing
Professional Fees
Other Expenses
Ground Rent
TOTAL OPERATING EXPENSES $0.00 $0.00 $0.00 $0.00 $0.00 % %
OPERATING EXPENSE RATIO
NET OPERATING INCOME $0.00 $0.00 $0.00 $0.00 $0.00
Leasing Commissions
Tenant Improvements
Replacement Reserve
TOTAL CAPITAL ITEMS $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
N.O.I. After Capital Items $0.00 $0.00 $0.00 $0.00 $0.00
DEBT SERVICE (PER SERVICER) $0.00 $0.00 $0.00 $0.00 $0.00
CASH FLOW AFTER DEBT SERVICE $0.00 $0.00 $0.00 $0.00 $0.00
DSCR: (NOI/Debt Service)
DSCR: (AFTER RESERVES\CAP EXP.)
SOURCE OF FINANCIAL DATA:
(ie. operating statements, financial statements, tax return, other)
</TABLE>
NOTES AND ASSUMPTIONS:
The years shown above will roll always showing a three year history. 1996 is the
current year financials; 1995 is the prior year financials.
This report may vary depending on the property type and because of the way
information may vary in each borrowers statement.
Rental Income needs to be broken down, differently whenever possible for each
property type as follows: Retail: 1) Base Rent 2)Percentage rents on cashflow
Hotel: 1)Room Revenue 2)Food/Beverage Nursing Home: 1)Private 2) Medicaid 3)
Medicare
INCOME: COMMENT
EXPENSE: COMMENT
CAPITAL ITEMS: COMMENT
B-25
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
ANNEX C
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
STRUCTURAL AND COLLATERAL TERM SHEET
$1,031,057,000 (APPROXIMATE BALANCE) AUGUST 26, 1999
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1999-C3
APPROXIMATE SECURITIES STRUCTURE:
- ---------------------------------
APPROXIMATE EXPECTED EXPECTED
EXPECTED FACE/NOTIONAL CREDIT WEIGHTED EXPECTED
CLASS RATING AMOUNT SUPPORT AVERAGE LIFE PAYMENT
(A) MOODY'S/FITC (MM) (% OF UPB) (YEARS) (b) WINDOW (b)
- --------------------------------------------------------------------------------
PUBLICLY OFFERED CLASSES
X (c) Aaa/AAA $1,152.0 N/A 9.2 10/99 - 3/16
A1a Aaa/AAA 50.0 27.00 5.8 10/99 - 5/08
A1b Aaa/AAA 191.0 27.00 9.6 5/08 - 8/09
A2 Aaa/AAA 600.0 27.00 8.8 10/99 - 8/09
B Aa2/AA 51.8 22.50 9. 98/09 - 8/09
C A2/A 57.6 17.50 9.9 8/09 - 8/09
D A3/A- 20.2 15.75 9.9 8/09 - 8/09
E Baa2/BBB 37.4 12.50 9.9 8/09 - 8/09
F Baa3/BBB- 23.0 10.50 9.9 8/09 - 8/09
PRIVATELY OFFERED CLASSES (D)
- --------------------------------------------------------------------------------
G
H
J
K
L
M
N
TOTAL SECURITIES: $1,152.0
- ---------------------------------------------------
(a) Class A1a is expected to have a fixed pass-through rate. Classes A1b through
C and G through N are expected to have a fixed pass-through rate subject to
a cap equal to the weighted average Net Mortgage Pass-Through Rate. Classes
D through F are expected to have a pass-through rate equal to the weighted
average Net Mortgage Pass-Through Rate.
(b) Calculated at 0% CPR, assuming no balloon payment extension and that ARD
Loans pay in full on Anticipated Repayment Dates.
(c) Notional amount on interest only class.
(d) Not offered hereby.
KEY FEATURES:
- -------------
Lead Managers: Deutsche Banc Alex. Brown
Goldman, Sachs & Co.
Selling Group: Newman and Associates, Inc.
Mortgage Loan GMAC Commercial Mortgage
Sellers (a): Corporation (57.14%)
German American Capital Corporation (21.50%)
Goldman Sachs Mortgage Company (21.36%)
Master Servicer: GMAC Commercial Mortgage Corporation
Special Servicer: GMAC Commercial Mortgage Corporation
Trustee: Norwest Bank National Association
Launch: August 25, 1999
Pricing: August 26, 1999
Anticipated Settlement: On or about September 14, 1999
Cut-Off Date: September 1, September 5 and
September 10, 1999
Distribution Date: 15th of each month, or following business day
(commencing October 1999)
Payment Delay: 14 days
ERISA Eligible: Classes A1a, A1b, A2, and X are expected to be ERISA
eligible subject to certain conditions for
eligibility.
SMMEA Eligible: Classes A1a, A1b, A2, X and B are expected to be
SMMEA securities upon issuance.
Structure: Sequential pay
Day Count: 30/360
Tax Treatment: REMIC
Rated Final
Distribution Date: August 15, 2036
Clean up Call: 1.0%
Minimum Publicly Offered Classes
Denominations: except Class X: $25,000 & $1
Class X: $1,000,000 Notional
Amount & $1
Delivery: DTC
(a) Percentages represent the portion of the Aggregate Cut-Off Date Principal
Balance contributed by each Mortgage Loan Seller.
- --------------------------------------------------------------------------------
COLLATERAL FACTS:
- -----------------
Initial Pool Balance: $1,152,022,048
Number of Mortgage Loans: 138
Number of Mortgaged Properties: 177
Average Cut-Off Date Balance: $8,347,986
Weighted Average Current Mortgage Rate: 7.896%
Weighted Average U/W DSCR (a): 1.37x
Weighted Average Cut-Off Date LTV Ratio (a): 68.84%
Weighted Average Remaining Term to Maturity (months): 117.4 months
Weighted Average Remaining Amortization Term (months): 342.1 months
Weighted Average Seasoning (months): 3.50 months
CTL Loans as a % of Total 0.13%
Balloon Loans as % of Total (b): 99.87%
Single Largest Loan as % of Total: 6.94%
Five Largest Loans as % of Total: 23.22%
Ten Largest Loans as % of Total: 34.96%
(a) All DSCR and LTV information presented herein is generally calculated as
though any related earnout reserve had been applied to reduce or defease the
primary balance of the mortgage loan.
(b) Includes 28 ARD loans totaling $431 mm and 37.4% of the pool Cut-Off date
balance.
TEN LARGEST LOANS OR SPONSORS
- -----------------------------
<TABLE>
<CAPTION>
CURRENT
LOAN BALANCE % BY UPB LTV DSCR PROPERTY TYPE
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Biltmore Fashion Park $80,000,000 6.94% 60.38% 1.4x Anchored Retail
Prime Outlets at Niagara Falls 62,835,426 5.45 72.73 1.3 Anchored Retail
Equity Inns Portfolio 48,428,074 4.20 49.26 1.9 Hospitality
One Colorado Place 42,628,093 3.70 72.25 1.2 Anchored Retail
Comerica Bank Building 33,640,510 2.92 65.19 1.4 Office
120 Monument Circle 28,955,362 2.51 74.44 1.2 Office
125 Maiden Lane 28,500,000 2.47 73.83 1.3 Office
Texas Development Portfolio 26,926,701 2.34 72.03 1.3 Multifamily
Sherman Plaza 25,984,904 2.26 68.38 1.2 Office
Alliance TP Portfolio 24,888,157 2.16 86.42 1.1 Multifamily
---------- ---- ----- ---
TOTAL/WTD. AVG. $402,787,227 34.96% 67.49% 1.40X
- ---------------------------------------------------------------------------------------------
SELECTED LOAN DATA:
- -------------------
NUMBER OF CUT-OFF DATE BALANCE
GEOGRAPHIC MORTGAGED ----------------------------------------
DISTRIBUTION PROPERTIES (MM) % BY UPB WTD. AVG. DSCR
- --------------------------------------------------------------------------------
California 33 $257.5 22.4% 1.34x
Texas 32 171.0 14.8 1.37
New York 12 135.8 11.8 1.34
Arizona 7 106.2 9.2 1.47
Indiana 5 68.6 6.0 1.29
Other (a) 88 413.0 35.8 1.39
-- ----- ---- ----
TOTAL/WTD.AVG. 177 $1,152.0 100.0% 1.37X
- --------------------------------------------------------------------------------
PROPERTY TYPE
- --------------------------------------------------------------------------------
Retail (b) 34 $350.7 30.4% 1.36x
Office 36 322.1 28.0 1.33
Multifamily 55 259.8 22.6 1.29
Hospitality 25 105.8 9.2 1.65
Industrial 21 99.1 8.6 1.42
Mobile Home Park 2 4.4 0.4 1.40
Special Purpose 1 3.9 0.3 1.26
Self Storage 1 3.2 0.3 2.17
Mixed Use 2 3.1 0.3 1.42
-- --- --- ----
TOTAL/WTD.AVG. 177 $1,152.0 100.0% 1.37X
- --------------------------------------------------------------------------------
PREPAYMENT RESTRICTIONS
- --------------------------------------------------------------------------------
Defeasance 135 1,102.6 95.7% 1.36x
> YM or 1% UPB 2 38.6 3.3 1.43
> YM or 1% & Defeasance 1 10.9 0.9 1.90
- - ---- --- ----
TOTAL/WTD. AVG. 138 1,152.0 100.0% 1.37X
- --------------------------------------------------------------------------------
</TABLE>
(a) Includes 30 states.
(b) 17 properties representing 25.14% of the Aggregate Cut-Off Date Balance are
Anchored Retail properties; 17 properties representing 5.30% of the
Aggregate Cut-Off Date Balance are Unanchored Retail properties.
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-1
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
MORTGAGE POOL OVERVIEW
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------
COLLATERAL FACTS LOAN GROUP 1 LOAN GROUP 2 AGGREGATE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
INITIAL POOL BALANCE: $892,242,246 $259,779,802 $1,152,022,048
NUMBER OF MORTGAGE LOANS: 99 39 138
NUMBER OF MORTGAGE PROPERTIES 122 55 177
AVERAGE CUT-OFF DATE BALANCE: $9,012,548 $6,661,021 $8,347,986
WEIGHTED AVERAGE CURRENT MORTGAGE RATE: 7.976% 7.619% 7.896%
WEIGHTED AVERAGE U/W DSCR: 1.39x 1.29x 1.37x
WEIGHTED AVERAGE CUT-OFF DATE LTV RATIO: 66.64% 76.41% 68.84%
WEIGHTED AVERAGE REMAINING TERM TO 117.2 118.0 117.4
MATURITY:
WEIGHTED AVERAGE REMAINING AMORTIZATION 341.6 343.5 342.1
TERM:
WEIGHTED AVERAGE SEASONING: 3.27 4.29 3.50
BALLOON/ARD LOANS AS % OF TOTAL: 99.84% 100.00% 99.87%
FIVE LARGEST LOANS AS % OF TOTAL: 29.98% 40.39% 23.22%
- ---------------------------------------------------------------------------------------------------
</TABLE>
--------------- ---------------
LOAN GROUP I LOAN GROUP II
--------------- ---------------
| \ 61% |
| \ | 100%
39% | \ |
| \-------------
---------------- A-2 X
A-1a -------------
----------------
A-1b
-----------------------------------
B
-----------------------------------
X C
-----------------------------------
D
-----------------------------------
E
-----------------------------------
F
-----------------------------------
NON-INVESTMENT GRADE TRANCHES
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-2
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
STRUCTURAL OVERVIEW
- --------------------------------------------------------------------------------
o Loan Group 1 is comprised of all 99 of the non-multifamily Loans with an
aggregate Cut-Off Date Principal Balance of $892 million. Loan Group 2 is
comprised of all 39 of the multifamily loans with an aggregate Cut-Off Date
Principal Balance of $260 million.
o Principal and Interest payments will be made from Group 1 in the following
manner:
- 39.00% of Interest to A1 Class and 61.00% of Interest to A2 Class,
- 39.00% of Principal sequentially to A1a and A1b and 61.00% to the A2 Class
until retired.
- After A1 Classes are retired Principal to A2 until all Class A
certificates are retired.
- Interest and Principal sequentially to Classes B, C, D, E, F, G, H, J, K,
L, M and N.
o Principal and Interest payments will be made from Group 2 in the following
manner:
- Interest and Principal to A2, and upon the retirement of the A2, all cash
flow will be combined with Group 1 and applied as set forth above.
o Principal Losses will be allocated in reverse alphabetical order to Class
N, M, L, K, J, H, G, F, E, D, C, B, and then pro rata to Classes A1a, A1b
and A2 regardless of Loan Group.
o Each Class will be subordinate to the Class A1a, A1b, A2 and X and to each
Class with an earlier alphabetic designation than such Class. Each of the
Class A1, A2 and X Certificates will be of equal priority.
o The Master Servicer will cover net prepayment Interest shortfalls, provided
that with respect to any loans with due dates on or preceding the related
determination date the Master Servicer will only cover net prepayment
Interest shortfalls up to the Master Servicing fee of 2 basis points on the
principal balance of such loans. Net prepayment Interest shortfalls (after
application of prepayment Interest excesses and other Servicer coverage
from the Master Servicing Fee) will be allocated pro-rata (based on
Interest entitlements) to all regular Certificates.
o Shortfalls resulting from Master Servicer and Special Servicer
modifications, Special Servicer compensation or other extraordinary trust
fund expenses will be allocated in reverse alphabetical order to classes of
outstanding regular Certificates other than to the Class X.
o All Classes will pay Interest on a 30/360 basis.
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-3
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
ALLOCATION OF PREPAYMENT PREMIUMS
- --------------------------------------------------------------------------------
PREPAYMENT PREMIUM EXAMPLE:
o The Yield Maintenance prepayment premium will generally be equal to the
present value of the reduction in Interest payments as a result of the
prepayment through the maturity of the prepaid Mortgage Loan, discounted at
the yield of a Treasury security of similar maturity in most cases
(converted from semi-annual to monthly pay). The following example reflects
that method.
GENERAL YIELD MAINTENANCE EXAMPLE FOR GROUP 1 MORTGAGE LOAN:
Assuming the structure presented in the beginning of this memo, that a Loan
Group 1 Mortgage Loan prepays, so Class A1a and Class A2 are the only
classes entitled to principal and the following assumptions: Mortgage Loan
Characteristics of Loan Group 1 Mortgage Loan being prepaid:
Balance $10,000,000
Coupon 7.80%
Maturity 10 yrs (September 1, 2009)
Treasury Rate (annualized monthly rate) 6.00%
Certificate Characteristics
Class A1a Coupon 7.40%
Class A2 Coupon 7.40%
Discount Rate Fraction Example:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
CLASS A1A CLASS A2 CLASS X
CERTIFICATES CERTIFICATES CERTIFICATES
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
PRINCIPAL PAYMENT $3,900,000 $6,100,000 N/A
- -----------------------------------------------------------------------------------------------------------
DISCOUNT RATE FRACTION CALCULATION (7.40% - 6.00%) / (7.40% - 6.00%) / 100.00% - 77.78% =
(7.80% - 6.00%) = (7.80% - 6.00%) = 22.22%
77.78% 77.78%
- -----------------------------------------------------------------------------------------------------------
% TOTAL PRINCIPAL DISTRIBUTION 39.00% 61.00% N/A
- -----------------------------------------------------------------------------------------------------------
% PREMIUM ALLOCATED 39.00% * 77.78% = 61.00% * 77.78% = 22.22%
30.33% 47.44%
- -----------------------------------------------------------------------------------------------------------
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-4
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
ALLOCATION OF PREPAYMENT PREMIUMS
- --------------------------------------------------------------------------------
GENERAL YIELD MAINTENANCE EXAMPLE FOR LOAN GROUP 2 MORTGAGE LOAN:
Assuming the structure presented in the beginning of this memo, that a Loan
Group 2 Mortgage Loan prepays, so Class A2 is the only class entitled to
principal and the following assumptions: Mortgage Loan Characteristics of
Loan Group 2 Mortgage Loan being prepaid:
Balance $10,000,000
Coupon 7.80%
Maturity 10 yrs (September 1, 2009)
Treasury Rate (annualized monthly rate) 6.00%
Certificate Characteristics
Class A1a Coupon 7.40%
Class A2 Coupon 7.40%
Discount Rate Fraction Example:
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------
CLASS A1A CLASS A2 CLASS X
CERTIFICATES CERTIFICATES CERTIFICATES
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
PRINCIPAL PAYMENT $0 $10,000,000 N/A
- ---------------------------------------------------------------------------------------------------------------
DISCOUNT RATE FRACTION CALCULATION (7.40% - 6.00%) / (7.40% - 6.00%) / 100.00% - 77.78% =
(7.80% - 6.00%) = (7.80% - 6.00%) = 22.22%
77.78% 77.78%
- ---------------------------------------------------------------------------------------------------------------
% TOTAL PRINCIPAL DISTRIBUTION 0% 100% N/A
- ---------------------------------------------------------------------------------------------------------------
% PREMIUM ALLOCATED 0% 100% * 77.78% = 22.22%
77.78%
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-5
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PREPAYMENT PROFILES
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PREPAYMENT RESTRICTION ASSUMING NO PREPAYMENT OF PRINCIPAL (A) (B)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
o AGGREGATE POOL
- -----------------------------------------------------------------------------------
PREPAYMENT OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER
RESTRICTIONS 1999 2000 2001 2002 2003 2004 2005
- -----------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Locked out 99.06% 99.05% 33.44% 8.18% 1.60% 0.00% 0.00%
Defeasance 0.00 0.00 66.56 88.90 95.07 96.67 96.68
Yield Maintenance 0.94 0.95 0.00 2.92 3.33 3.33 3.32
- -----------------------------------------------------------------------------------
Sub Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Open 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
- -------------------------------------------------------------------------------------
Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM) 1,152.02 1,142.74 1,131.83 1,119.79 1,106.73 1,092.68 1,077.22
% of Initial UPB 100.00% 99.19% 98.25% 97.20% 96.07% 94.85% 93.51%
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
PREPAYMENT OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER
RESTRICTIONS 2006 2007 2008 2009 2010 2011
- -----------------------------------------------------------------------------------
Locked out 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Defeasance 96.63 93.59 98.26 100.00 100.00 100.00
Yield Maintenance 3.37 3.36 0.00 0.00 0.00 0.00
- -----------------------------------------------------------------------------------
Sub Total 100.00% 96.95% 98.26% 100.00% 100.00% 100.00%
Open 0.00% 3.05% 1.74% 0.00% 0.00% 0.00%
- -----------------------------------------------------------------------------------
Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM) 1,045.10 1,027.36 901.09 27.56 24.99 23.93
% of Initial UPB 90.72% 89.18% 78.22% 2.39% 2.17% 2.08%
- -----------------------------------------------------------------------------------
o LOAN GROUP 1
- -----------------------------------------------------------------------------------
PREPAYMENT OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER
RESTRICTIONS 1999 2000 2001 2002 2003 2004 2005
- -----------------------------------------------------------------------------------
Locked out 98.78% 98.77% 33.61% 6.83% 1.64% 0.00% 0.00%
Defeasance 0.00 0.00 66.39 89.41 94.60 96.24 96.24
Yield Maintenance 1.22 1.23 0.00 3.76 3.76 3.76 3.76
- -----------------------------------------------------------------------------------
Sub Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Open 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
- -----------------------------------------------------------------------------------
Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM) 892.24 885.52 877.42 868.41 858.64 848.08 836.44
% of Initial UPB 100.00% 99.25% 98.34% 97.33% 96.23% 95.05% 93.75%
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
PREPAYMENT OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER
RESTRICTIONS 2006 2007 2008 2009 2010 2011
- -------------------------------------------------------------------------------------
Locked out 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Defeasance 96.17 96.17 97.93 100.00 100.00 100.00
Yield Maintenance 3.83 3.83 0.00 0.00 0.00 0.00
- -----------------------------------------------------------------------------------
Sub Total 100.00% 100.00% 97.93% 100.00% 100.00% 100.00%
Open 0.00% 0.00% 2.07% 0.00% 0.00% 0.00%
- -----------------------------------------------------------------------------------
Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM) 808.45 795.16 715.72 16.65 14.71 14.32
% of Initial UPB 90.61% 89.12% 80.22% 1.87% 1.65% 1.61%
- -----------------------------------------------------------------------------------
o LOAN GROUP 2
- -----------------------------------------------------------------------------------
PREPAYMENT OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER
RESTRICTIONS 1999 2000 2001 2002 2003 2004 2005
- -----------------------------------------------------------------------------------
Locked out 100.00% 100.00% 32.84% 12.84% 1.47% 0.00% 0.00%
Defeasance 0.00 0.00 67.16 87.16 96.69 98.18 98.20
Yield Maintenance 0.00 0.00 0.00 0.00 1.84 1.82 1.80
- -----------------------------------------------------------------------------------
Sub Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Open 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
- -----------------------------------------------------------------------------------
Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM) 259.78 257.22 254.41 251.37 248.09 244.60 240.78
% OF INITIAL UPB 100.00% 99.01% 97.93% 96.76% 95.50% 94.16% 92.69%
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
PREPAYMENT OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER OCTOBER
RESTRICTIONS 2006 2007 2008 2009 2010 2011
- -----------------------------------------------------------------------------------
Locked out 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%
Defeasance 98.22 84.75 99.52 100.00 100.00 100.00
Yield Maintenance 1.78 1.76 0.00 0.00 0.00 0.00
- -----------------------------------------------------------------------------------
Sub Total 100.00% 86.51% 99.52% 100.00% 100.00% 100.00%
Open 0.00% 13.49% 0.48% 0.00% 0.00% 0.00%
- -----------------------------------------------------------------------------------
Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
UPB ($MM) 236.65 232.20 185.36 10.91 10.29 9.61
% of Initial UPB 91.10% 89.38% 71.35% 4.20% 3.96% 3.70%
- -----------------------------------------------------------------------------------
</TABLE>
(a) All tables calculated using maturity assumptions.
(b) Differences in totals may exist due to rounding.
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-6
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
AVERAGE LIFE TABLE (IN YEARS) - AGGREGATE POOL
(PREPAYMENTS LOCKED OUT THROUGH LOCK OUT PERIOD, DEFEASANCE AND YIELD
MAINTENANCE, THEN RUN AT THE INDICATED CPRS)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PREPAYMENT ASSUMPTIONS (CPR)
0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
- --------------------------------------------------------------------------------
A1A 5.8 5.8 5.8 5.7 5.7
A1B 9.6 9.6 9.6 9.6 9.4
A2 8.8 8.8 8.8 8.8 8.6
B 9.9 9.9 9.9 9.8 9.7
C 9.9 9.9 9.9 9.9 9.7
D 9.9 9.9 9.9 9.9 9.7
E 9.9 9.9 9.9 9.9 9.7
F 9.9 9.9 9.9 9.9 9.8
- --------------------------------------------------------------------------------
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-7
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DISTRIBUTION OF CUT-OFF DATE BALANCES
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
PERCENTAGE OF WEIGHTED REMAINING AVERAGE
NUMBER OF AGGREGATE WEIGHTED AVERAGE TERM TO CUT-OFF
RANGE OF CUT-OFF DATE MORTGAGE CUT-OFF DATE CUT-OFF DATE AVERAGE CUT-OFF AVERAGE MORTGAGE MATURITY DATE LTV
BALANCES LOANS BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$500,000 - 999,999 1 $869,138 0.08% $869,138 1.21x 8.260% 118.0 79.01%
1,000,000 - 1,999,999 22 34,711,286 3.01 1,577,786 1.41 7.853 119.2 68.32
2,000,000 - 2,999,999 15 36,295,522 3.15 2,419,701 1.30 7.934 122.0 73.67
3,000,000 - 3,999,999 18 61,584,647 5.35 3,421,369 1.37 8.067 117.0 70.17
4,000,000 - 4,999,999 18 83,234,257 7.23 4,624,125 1.37 7.719 115.6 70.31
5,000,000 - 5,999,999 7 39,941,631 3.47 5,705,947 1.25 8.036 118.3 74.68
6,000,000 - 6,999,999 11 71,315,608 6.19 6,483,237 1.36 8.051 119.3 70.97
7,000,000 - 7,999,999 8 59,364,057 5.15 7,420,507 1.32 7.976 115.9 66.24
8,000,000 - 8,999,999 3 25,726,434 2.23 8,575,478 1.38 8.068 118.3 65.96
9,000,000 - 9,999,999 5 47,365,594 4.11 9,473,119 1.42 8.031 128.0 68.83
10,000,000 - 11,999,999 6 65,173,851 5.66 10,862,309 1.43 7.822 108.6 69.85
12,000,000 - 13,999,999 5 65,367,148 5.67 13,073,430 1.31 7.989 129.8 70.87
14,000,000 - 16,999,999 4 60,679,367 5.27 15,169,842 1.42 8.191 112.8 67.86
17,000,000 - 19,999,999 2 35,370,331 3.07 17,685,165 1.23 7.808 116.5 72.53
20,000,000 - 24,999,999 4 89,040,863 7.73 22,260,216 1.29 7.556 114.9 70.36
25,000,000 - 49,999,999 7 233,146,887 20.24 33,306,698 1.42 7.987 116.0 66.70
50,000,000 - 80,000,000 2 142,835,426 12.40 71,417,713 1.40 7.647 117.1 65.81
- ----------- ----- ---------- ---- ----- ----- -----
TOTAL/WTD. AVG. 138 $1,152,022,048 100.00% $8,347,986 1.37X 7.896% 117.4 68.84%
=======================================================================================================
====================================================================================================================================
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-8
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DISTRIBUTION OF MORTGAGED PROPERTIES BY STATE
- --------------------------------------------------------------------------------
OR 0.46% MN 0.28% GA 0.67% CT 0.36%
CA 22.35% MO 1.79% FL 4.14% NJ 2.80%
NV 0.52% WI 0.53% WV 0.18% DE 0.28%
ID 0.23% IL 1.05% SC 0.97% MD 0.85%
AZ 9.22% MS 2.00% PA 1.07% HI 0.68%
CO 1.08% MI 1.40% VA 1.07%
NE 0.41% IN 5.96% NC 3.28%
KS 0.35% TN 1.00% NY 11.79%
OK 1.15% AL 0.42% NH 1.38%
TX 14.84% OH 4.25% MA 1.20%
Indiana 5.96%
Ohio 4.25%
Other (a) 31.60%
California 22.35%
Texas 14.84%
New York 11.79%
Arizona 9.22%
(a) Includes 29 states
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting
this material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange
Commission (the "SEC") and incorporated by reference into an effective
registration statement previously filed with the SEC under Rule 415 of the
Securities Act of 1933, including in cases where the material does not pertain
to securities that are ultimately offered for sale pursuant to such
registration statement. Information contained in this material is current as of
the date appearing on this material only. Information in this material
regarding any assets backing any securities discussed herein supersedes all
prior information regarding such assets. All information in this Term Sheet,
whether regarding the assets backing any securities discussed herein or
otherwise, will be superseded by the information contained in any final
prospectus for any securities actually sold to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates
in connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-9
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DISTRIBUTION OF MORTGAGED PROPERTIES BY STATE (A)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
PERCENTAGE OF WEIGHTED REMAINING AVERAGE
NUMBER OF AGGREGATE WEIGHTED AVERAGE TERM TO CUT-OFF
MORTGAGED CUT-OFF DATE CUT-OFF DATE AVERAGE CUT-OFF AVERAGE MORTGAGE MATURITY DATE LTV
STATE PROPERTIES BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
California 33 $257,522,409 22.35% $7,803,709 1.34x 7.815% 116.0 68.47%
Texas 32 170,965,037 14.84 5,342,657 1.37 8.001 120.3 71.30
New York 12 135,788,097 11.79 11,315,675 1.34 7.847 117.3 67.02
Arizona 7 106,162,273 9.22 15,166,039 1.47 7.779 118.0 59.99
Indiana 5 68,623,517 5.96 13,724,703 1.29 7.698 108.0 75.27
Ohio 7 48,960,798 4.25 6,994,400 1.38 8.086 133.3 70.74
Florida 10 47,748,245 4.14 4,774,824 1.25 7.916 118.2 74.77
North Carolina 6 37,752,413 3.28 6,292,069 1.42 7.887 117.3 66.07
New Jersey 9 32,244,153 2.80 3,582,684 1.44 8.086 118.1 62.95
Mississippi 2 23,067,864 2.00 11,533,932 1.38 7.893 118.9 72.68
Missouri 4 20,637,328 1.79 5,159,332 1.30 7.944 118.7 70.14
Michigan 4 16,094,862 1.40 4,023,715 1.30 7.460 118.3 80.40
New Hampshire 1 15,949,087 1.38 15,949,087 1.28 8.529 116.0 72.50
Massachusetts 2 13,790,736 1.20 6,895,368 1.49 8.256 119.0 66.60
Oklahoma 3 13,288,731 1.15 4,429,577 1.37 7.700 117.6 77.99
Colorado 2 12,427,897 1.08 6,213,948 1.32 8.130 117.0 64.58
Virginia 4 12,380,850 1.07 3,095,213 1.51 8.078 117.7 59.83
Pennsylvania 3 12,334,523 1.07 4,111,508 1.29 7.614 114.5 70.70
Illinois 1 12,098,410 1.05 12,098,410 1.19 7.320 119.0 86.42
Tennessee 4 11,502,989 1.00 2,875,747 1.73 7.956 112.2 57.34
South Carolina 1 11,191,325 0.97 11,191,325 1.40 8.750 83.0 70.39
Maryland 3 9,771,141 0.85 3,257,047 1.31 8.089 129.7 71.56
Hawaii 2 7,833,417 0.68 3,916,709 1.38 7.836 117.0 75.94
Georgia 3 7,734,324 0.67 2,578,108 1.26 8.170 138.6 65.75
Wisconsin 1 6,082,695 0.53 6,082,695 1.45 8.250 80.0 70.73
Nevada 1 5,937,441 0.52 5,937,441 1.25 8.110 119.0 78.12
Oregon 1 5,286,058 0.46 5,286,058 1.90 8.370 118.0 49.51
Alabama 1 4,894,842 0.42 4,894,842 1.24 8.050 118.0 79.59
Nebraska 5 4,673,453 0.41 934,691 1.45 6.760 104.0 71.03
Connecticut 2 4,123,922 0.36 2,061,961 1.25 7.961 117.5 79.31
Kansas 2 3,993,245 0.35 1,996,622 1.90 8.370 118.0 49.51
Minnesota 1 3,244,511 0.28 3,244,511 1.90 8.370 118.0 49.51
Delaware 1 3,240,153 0.28 3,240,153 2.17 7.490 117.0 60.79
Idaho 1 2,653,725 0.23 2,653,725 1.32 7.810 119.0 72.31
West Virginia 1 2,021,580 0.18 2,021,580 1.90 8.370 118.0 49.51
- --------- ---- --------- ---- ----- ----- -----
TOTAL/WTD. AVG. 177 $1,152,022,048 100.00% $6,508,599 1.37X 7.896% 117.4 68.84%
=================================================================================================================
===================================================================================================================================
</TABLE>
(a) If a Mortgage Loan is secured by properties in multiple states, it is
treated as multiple Mortgage Loans each of which is allocated a cut-off
balance based on the allocated loan amount.
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-10
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DISTRIBUTION OF PROPERTY TYPES
- --------------------------------------------------------------------------------
Industrial 8.60%
Other 1.26%
Retail:
Anchored 25.14%
Unanchored 5.30%
Total 30.44%
Office 27.96%
Multi-family 22.55%
Hospitality 9.19%
<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
PERCENTAGE OF WEIGHTED REMAINING AVERAGE
NUMBER OF AGGREGATE WEIGHTED AVERAGE TERM TO CUT-OFF
MORTGAGED CUT-OFF DATE CUT-OFF DATE AVERAGE CUT-OFF AVERAGE MORTGAGE MATURITY DATE LTV
PROPERTY TYPE PROPERTIES BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Retail
Anchored 17 $ 289,664,493 25.14% $17,039,088 1.36 7.886 121.1 68.72%
Unanchored 17 61,018,568 5.30 3,589,328 1.37 8.249 118.4 66.48
Retail Subtotal 34 $ 350,683,061 30.44% $10,314,208 1.36x 7.949 120.6 68.33%
Office 36 $ 322,053,842 27.96% $8,945,940 1.33 7.794 115.1 67.84%
Multifamily 55 259,779,802 22.55 4,723,269 1.29 7.619 118.0 76.41
Hospitality 25 105,832,139 9.19 4,233,286 1.65 8.498 112.0 58.93
Industrial 21 99,126,076 8.60 4,720,289 1.42 8.128 117.9 64.93
Mobile Home Park 2 4,356,188 0.38 2,178,094 1.40 7.326 113.8 69.98
Special Purpose 1 3,896,785 0.34 3,896,785 1.26 8.460 119.0 67.19
Self-Storage 1 3,240,153 0.28 3,240,153 2.17 7.490 117.0 60.79
Mixed Use 2 3,054,003 0.27 1,527,001 1.42 8.118 116.1 69.09
- --------- ---- --------- ---- ----- ----- -----
TOTAL/WTD. AVG 177 $1,152,022,048 100.00% $6,508,599 1.37X 7.896% 117.4 68.84%
============================================================================================================
====================================================================================================================================
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-11
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DISTRIBUTION OF UNDERWRITTEN NCF DEBT SERVICE COVERAGE RATIOS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
PERCENTAGE OF WEIGHTED REMAINING AVERAGE
RANGE OF DEBT NUMBER OF AGGREGATE WEIGHTED AVERAGE TERM TO CUT-OFF
SERVICE COVERAGE MORTGAGE CUT-OFF DATE CUT-OFF DATE AVERAGE CUT-0FF AVERAGE MORTGAGE MATURITY DATE LTV
RATIOS LOANS BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1.00 - 1.10 (a) 1 $1,451,189 0.13% $1,451,189 1.01x 7.720% 198.0 82.93%
1.11 - 1.20 15 130,279,657 11.31 8,685,310 1.20 7.808 118.5 76.39
1.21 - 1.30 56 391,759,719 34.01 6,995,709 1.25 8.032 120.2 71.42
1.31 - 1.40 25 258,609,503 22.45 10,344,380 1.35 7.754 113.7 72.33
1.41 - 1.50 23 222,532,097 19.32 9,675,309 1.44 7.716 113.0 65.34
1.51 - 1.60 6 28,383,013 2.46 4,730,502 1.58 7.828 117.5 61.46
1.61 - 1.70 5 40,516,247 3.52 8,103,249 1.66 8.473 132.3 53.94
1.71 - 1.80 2 11,027,927 0.96 5,513,964 1.78 7.651 117.7 60.88
1.81 - 1.90 4 64,222,542 5.57 16,055,635 1.89 8.169 117.2 50.00
2.11 - 2.20 1 3,240,153 0.28 3,240,153 2.17 7.490 117.0 60.79
- --------- ---- --------- ---- ----- ----- -----
TOTAL/WTD. AVG. 138 $1,152,022,048 100.00% $8,347,986 1.37X 7.896% 117.4 68.84%
================================================================================================================
====================================================================================================================================
</TABLE>
(a) Includes one CTL loan.
- --------------------------------------------------------------------------------
DISTRIBUTION OF CUT-OFF DATE LOAN TO VALUE AT ORIGINATION RATIOS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
PERCENTAGE OF WEIGHTED REMAINING AVERAGE
NUMBER OF AGGREGATE WEIGHTED AVERAGE TERM TO CUT-OFF
RANGE OF CUT-OFF DATE MORTGAGE CUT-OFF DATE CUT-OFF DATE AVERAGE CUT-0FF AVERAGE MORTGAGE MATURITY DATE LTV
LOAN TO VALUE RATIOS LOANS BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
30.1 - 50.0 5 $83,798,666 7.27% $16,759,733 1.68x 8.204% 118.2 47.59%
50.1 - 60.0 12 96,596,121 8.38 8,049,677 1.62 8.088 124.7 56.24
60.1 - 65.0 13 137,388,972 11.93 10,568,382 1.39 7.841 117.8 61.73
65.1 - 70.0 21 146,107,917 12.68 6,957,520 1.34 7.836 114.9 67.24
70.1 - 75.0 52 455,684,003 39.56 8,763,154 1.32 7.910 116.6 72.68
75.1 - 80.0 28 182,886,438 15.88 6,531,658 1.28 7.786 116.1 78.30
80.1 - 85.0 6 24,671,775 2.14 4,111,962 1.22 7.890 122.2 80.63
85.1 - 90.0 1 24,888,157 2.16 24,888,157 1.19 7.320 119.0 86.42
- ---------- ---- ---------- ---- ----- ----- -----
TOTAL/WTD. AVG. 138 $1,152,022,048 100.00% $8,347,986 1.37X 7.896% 117.4 68.84%
================================================================================================================
====================================================================================================================================
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-12
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
DISTRIBUTION OF MORTGAGE INTEREST RATES
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
PERCENTAGE OF WEIGHTED REMAINING AVERAGE
NUMBER OF AGGREGATE WEIGHTED AVERAGE TERM TO CUT-OFF
RANGE OF MORTGAGE CUT-OFF DATE CUT-OFF DATE AVERAGE CUT-OFF AVERAGE MORTGAGE MATURITY DATE LTV
MORTGAGE RATES LOANS BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
6.5001 - 6.7500 2 $6,649,512 0.58% $3,324,756 1.46x 6.737% 107.0 60.46%
6.7501 - 7.0000 3 34,940,407 3.03 11,646,802 1.35 6.913 103.7 75.22
7.0001 - 7.2500 8 43,519,970 3.78 5,439,996 1.37 7.122 106.5 73.39
7.2501 - 7.5000 13 99,706,616 8.65 7,669,740 1.30 7.380 116.7 75.63
7.5001 - 7.7500 17 278,931,993 24.21 16,407,764 1.41 7.625 116.2 66.48
7.7501 - 8.0000 27 192,797,827 16.74 7,140,660 1.31 7.902 116.5 69.21
8.0001 - 8.2500 35 218,686,328 18.98 6,248,181 1.31 8.130 117.9 71.04
8.2501 - 8.5000 22 203,060,046 17.63 9,230,002 1.45 8.355 121.7 64.44
8.5001 - 8.7500 9 60,364,119 5.24 6,707,124 1.38 8.638 127.3 69.69
8.7501 - 9.0000 2 13,365,230 1.16 6,682,615 1.46 8.818 118.7 61.93
----- -------------- ------- ------------ --------- ---------- ---------- -------
TOTAL/WTD. AVG. 138 $1,152,022,048 100.00% 8,347,986 1.37X 7.896% 117.4 68.84%
========================== ========== ============= ========== ======== ========== =======
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
- -------------------------------------------------------------------------------
DISTRIBUTION OF REMAINING AMORTIZATION TERMS (a)
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PERCENTAGE WEIGHTED
OF AVERAGE WEIGHTED
RANGE OF NUMBER AGGREGATE WEIGHTED REMAINING AVERAGE
REMAINING OF CUT-OFF AVERAGE WEIGHTED AVERAGE TERM TO CUT-OFF
AMORTIZATION MORTGAGE CUT-OFF DATE DATE CUT-OFF AVERAGE MORTGAGE MATURITY DATE LTV
TERMS (MONTHS) LOANS BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Interest Only 1 $10,875,000 0.94% $10,875,000 1.90x 7.540% 119.0 52.28%
191 - 210 1 1,451,189 0.13 1,451,189 1.01 7.720 198.0 82.93
231 - 250 2 17,215,427 1.49 8,607,714 1.35 8.098 161.3 64.94
271 - 290 2 9,832,983 0.85 4,916,491 1.64 7.168 105.5 56.12
291 - 310 23 156,293,506 13.57 6,795,370 1.56 8.336 113.6 61.74
331 - 360 109 956,353,943 83.02 8,773,889 1.33 7.832 117.2 70.37
--- --------------- ----- ----------- ---- ----- ----- -----
TOTAL/WTD. AVG. 138 $1,152,022,048 100.00% $8,347,986 1.37X 7.896% 117.4 68.84%
========= ==================================================================================================
</TABLE>
- -------------------------------------------------------------------------------
(a) 58 loans representing 35.90% of the Aggregate Cut-Off Date Balance accrue
interest on an Actual/360 basis but have a monthly payment calculated on a
30/360 schedule. Accordingly, the actual amortization term is longer for
these loans than the stated amortization term reflected in the table above.
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-13
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
DISTRIBUTION OF ORIGINAL TERMS TO MATURITY
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
PERCENTAGE OF WEIGHTED REMAINING AVERAGE
RANGE OF ORIGINAL NUMBER OF AGGREGATE WEIGHTED AVERAGE TERM TO CUT-OFF
TERMS TO MATURITY MORTGAGE CUT-OFF DATE CUT-OFF DATE AVERAGE CUT-OFF AVERAGE MORTGAGE MATURITY DATE LTV
(MONTHS) LOANS BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
- -------------------------------------------------- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
83 - 83 months 1 $6,082,695 0.53% $6,082,695 1.45x 8.250% 80.0 70.73%
84 - 120 months 130 1,105,509,111 95.96 8,503,916 1.37 7.882 115.8 68.78
121 - 180 months 6 38,979,053 3.38 6,496,509 1.35 8.236 164.5 69.79
181 - 240 months 1 1,451,189 0.13 1,451,189 1.01 7.720 198.0 82.93
- --------------- ------- ----------- ---- ----- ----- -----
TOTAL/WTD. AVG. 138 $1,152,022,048 100.00% $8,347,986 1.37X 7.896% 117.4 68.84%
========== =============== ==============================================================================
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
DISTRIBUTION OF REMAINING TERMS TO MATURITY
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
PERCENTAGE OF WEIGHTED REMAINING AVERAGE
RANGE OF REMAINING NUMBER OF AGGREGATE WEIGHTED AVERAGE TERM TO CUT-OFF
TERMS TO MATURITY MORTGAGE CUT-OFF DATE CUT-OFF DATE AVERAGE CUT-OFF AVERAGE MORTGAGE MATURITY DATE LTV
(MONTHS) LOANS BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
71 - 90 2 $17,274,020 1.50% $8,637,010 1.42x 8.574% 81.9 70.51%
91 - 110 16 138,555,213 12.03 8,659,701 1.39 7.251 104.0 71.05
111 - 120 114 962,072,092 83.51 8,439,229 1.37 7.958 117.8 68.49
131 - 150 1 1,799,078 0.16 1,799,078 1.30 8.125 131.0 71.96
171 - 190 4 30,870,456 2.68 7,717,614 1.36 8.460 178.8 68.20
191 - 210 1 1,451,189 0.13 1,451,189 1.01 7.720 198.0 82.93
- --------- ------- ----------- ----- ------- ------- -------
TOTAL/WTD. AVG. 138 $1,152,022,048 100.00% $8,347,986 1.37X 7.896% 117.4 68.84%
===========================================================================================================
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
DISTRIBUTION OF AMORTIZATION TYPES
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
PERCENTAGE OF WEIGHTED REMAINING AVERAGE
NUMBER OF AGGREGATE WEIGHTED AVERAGE TERM TO CUT-OFF
MORTGAGE CUT-OFF DATE CUT-OFF DATE AVERAGE CUT-OFF AVERAGE MORTGAGE MATURITY DATE LTV
AMORTIZATION TYPE LOANS BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balloon 109 $720,311,290 62.53% $6,608,360 1.34x 7.954% 119.7 69.15%
Hyperamortizing 28 430,259,568 37.35 15,366,413 1.41 7.800 113.3 68.28
Fully Amortizing 1 1,451,189 0.13 1,451,189 1.01 7.720 198.0 82.93
- ---------- ---- --------- ---- ----- ----- ------
TOTAL/WTD. AVG. 138 $1,152,022,048 100.00% $8,347,986 1.37x 7.896% 117.4 68.84%
============================================================================================================
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-14
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
- --------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
DISTRIBUTION OF PREPAYMENT PROVISIONS
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
WEIGHTED
AVERAGE WEIGHTED
PERCENTAGE OF WEIGHTED REMAINING AVERAGE
NUMBER OF AGGREGATE WEIGHTED AVERAGE TERM TO CUT-OFF
MORTGAGE CUT-OFF DATE CUT-OFF DATE AVERAGE CUT-OFF AVERAGE MORTGAGE MATURITY DATE LTV
PREPAYMENT PROVISION LOANS BALANCE BALANCE DATE BALANCE DSCR RATE (MOS) RATIO
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Defeasance 135 $1,102,593,023 95.71% $8,167,356 1.36x 7.915% 117.8 69.16%
> of YM or 1% UPB 2 38,554,025 3.35 19,277,012 1.43 7.448 104.3 64.52
> of YM or 1% and 1 10,875,000 0.94 10,875,000 1.90 7.540 119.0 52.28
---- ----------- ---- ---------- ---- ----- ----- -----
Defeasance
TOTAL/WTD. AVG. 138 $1,152,022,048 100.00% $8,347,986 1.37X 7.896% 117.4 68.84%
=============================================================================================================
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting this
material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange Commission
(the "SEC") and incorporated by reference into an effective registration
statement previously filed with the SEC under Rule 415 of the Securities Act of
1933, including in cases where the material does not pertain to securities that
are ultimately offered for sale pursuant to such registration statement.
Information contained in this material is current as of the date appearing on
this material only. Information in this material regarding any assets backing
any securities discussed herein supersedes all prior information regarding such
assets. All information in this Term Sheet, whether regarding the assets backing
any securities discussed herein or otherwise, will be superseded by the
information contained in any final prospectus for any securities actually sold
to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates in
connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-15
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
BILTMORE FASHION PARK
- --------------------------------------------------------------------------------
LOAN INFORMATION
ORIGINAL CUT-OFF DATE
PRINCIPAL BALANCE (a): $80,000,000 $80,000,000
% OF POOL BY UPB 6.94%
NOTE DATE: June 16, 1999
INTEREST RATE: 7.68%
AMORTIZATION: 30 years
ARD DATE: 7/10/09
BORROWER/SPONSOR: The Borrower is a single purpose, bankruptcy remote
entity sponsored by the Taubman Realty Group Limited
Partnership, an affiliate of Taubman Centers, Inc., a
publicly traded Real Estate Investment Trust (NYSE:
TCO).
CALL PROTECTION: Prepayment lockout; U.S. Treasury defeasance.
CROSS-COLLATERALIZATION/
DEFAULT: No/No
ADDITIONAL FINANCING: The Borrower is permitted to incur up to $3,000,000 of
indebtedness that relates solely to financing capital
improvements, compliance with legal requirements,
tenant improvements, leasing costs and equipment
related to the Biltmore Fashion Park property, but
only if that indebtedness remains unsecured or
secured by capital leases.
CASH MANAGEMENT: Soft Lockbox in place springing to a Hard Lockbox at
the ARD date or either upon an Event of Default or if
the DSCR falls below 1.30x.
MONTHLY RESERVES: All reserves are waived unless the Soft Lockbox has
converted to a Hard Lockbox.
PROPERTY INFORMATION
SINGLE ASSET/PORTFOLIO: Single Asset
PROPERTY TYPE: Anchored Retail
LOCATION: Phoenix, Arizona
YEAR(S) BUILT / RENOVATED: 1963-1996 / 1999
THE COLLATERAL: An outdoor, regional shopping mall situated on
28.59 acres. The mall has a total of 550,949
square feet of gross leaseable area, of which
398,449 square feet serve as collateral for the
Loan. The mall is anchored by a Saks Department
Store and a Macy's Department Store. The building
containing the Macy's is not part of the
collateral for the Loan
PROPERTY MANAGEMENT: Taubman Centers, Inc.
CURRENT OCCUPANCY (6/15/99): 96%
UNDERWRITTEN NET CASH FLOW: $9,894,554
APPRAISED VALUE: $132,500,000
APPRAISAL DATE: May 5, 1999
CUT-OFF DATE LOAN/SF: $145.20
CUT-OFF DATE LTV: 60.38%
ARD BALLOON LTV: 53.79%
UWNCF DSCR: 1.43x
THREE LARGEST TENANTS
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------
SQUARE PERCENTAGE OF DATE OF
TENANT FOOTAGE LEASED TOTAL LEASABLE AREA LEASE EXPIRATION
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Macy's (a) 152,500 27.68% 01/31/2013
- ---------------------------------------------------------------------------------------------
Saks Fifth Avenue 90,114 16.36% 10/31/2017
- ---------------------------------------------------------------------------------------------
Borders Books 33,416 6.07% 01/31/2004
- ---------------------------------------------------------------------------------------------
</TABLE>
(a) The Macy's building is not part of the collateral for the loan.
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting
this material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange
Commission (the "SEC") and incorporated by reference into an effective
registration statement previously filed with the SEC under Rule 415 of the
Securities Act of 1933, including in cases where the material does not pertain
to securities that are ultimately offered for sale pursuant to such
registration statement. Information contained in this material is current as of
the date appearing on this material only. Information in this material
regarding any assets backing any securities discussed herein supersedes all
prior information regarding such assets. All information in this Term Sheet,
whether regarding the assets backing any securities discussed herein or
otherwise, will be superseded by the information contained in any final
prospectus for any securities actually sold to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates
in connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-16
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
PRIME OUTLETS AT NIAGARA FALLS
- --------------------------------------------------------------------------------
LOAN INFORMATION
ORIGINAL CUT-OFF DATE
PRINCIPAL BALANCE (a): $63,000,000 $62,835,426
% OF POOL BY UPB 5.45%
NOTE DATE: April 27, 1999
INTEREST RATE: 7.60%
AMORTIZATION: 30 years
ARD DATE: May 10, 2009
BORROWER/SPONSOR: The Borrower is a single purpose, bankruptcy remote
entity affiliated with Prime Retail, Inc., a publicly
traded Real Estate Investment Trust (NYSE: PRT).
CALL PROTECTION: Prepayment lockout; U.S. Treasury defeasance.
CROSS-COLLATERALIZATION/
DEFAULT: No/No
ADDITIONAL FINANCING: None.
CASH MANAGEMENT: Soft Lockbox in place springing to a Hard Lockbox at
the ARD Date or upon an Event of Default.
MONTHLY RESERVES: TI/LC - $61,741
Replacement - $6,665
PROPERTY INFORMATION
SINGLE ASSET/PORTFOLIO: Single Asset
PROPERTY TYPE: Anchored Retail
LOCATION: Niagara Falls, New York
YEAR BUILT / RENOVATED: 1960, 1983 - 1995 / 1996
THE COLLATERAL: A partially enclosed, factory outlet center
located on 41.3 acres. The property has a total
of 533,192 net rentable square feet and also
includes a food court. Diverse tenant mix includes
Old Navy, Saks Off Fifth Avenue, Gap, Polo/Ralph
Lauren, among others.
PROPERTY MANAGEMENT: Prime Retail, Inc.
CURRENT OCCUPANCY (3/01/99): 96%
UNDERWRITTEN NET CASH FLOW: $7,361,978
APPRAISED VALUE: $86,400,000
APPRAISAL DATE: January 30, 1999
CUT-OFF DATE LOAN/SF: $117.85
CUT-OFF DATE LTV: 72.73%
ARD BALLOON LTV: 63.59%
UWNCF DSCR: 1.36x
THREE LARGEST TENANTS
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------
SQUARE PERCENTAGE OF DATE OF
TENANT FOOTAGE LEASED TOTAL LEASABLE AREA LEASE EXPIRATION
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Linens N' Things 27,175 5.10% 09/30/2005
- ---------------------------------------------------------------------------------------------
Marshall's 27,000 5.06% 11/30/2000
- ---------------------------------------------------------------------------------------------
Off 5th / Saks Fifth Avenue 20,359 3.82% 08/31/2010
- ---------------------------------------------------------------------------------------------
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting
this material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange
Commission (the "SEC") and incorporated by reference into an effective
registration statement previously filed with the SEC under Rule 415 of the
Securities Act of 1933, including in cases where the material does not pertain
to securities that are ultimately offered for sale pursuant to such
registration statement. Information contained in this material is current as of
the date appearing on this material only. Information in this material
regarding any assets backing any securities discussed herein supersedes all
prior information regarding such assets. All information in this Term Sheet,
whether regarding the assets backing any securities discussed herein or
otherwise, will be superseded by the information contained in any final
prospectus for any securities actually sold to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates
in connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-17
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
EQUITY INNS
- --------------------------------------------------------------------------------
LOAN/PARTICIPATION INFORMATION
ORIGINAL CUT-OFF DATE
PRINCIPAL BALANCE LOAN: $97,020,000 $96,856,149
PARTICIPATION: $48,510,000 $48,428,074
(% OF LOAN) (50%) (50%)
% OF POOL BY UPB: 4.20%
NOTE DATE: June 16, 1999
INTEREST RATE: 8.37%
AMORTIZATION: 25 years
ARD DATE: July 1, 2009
BORROWER/SPONSOR: Two single purpose, bankruptcy remote entities
affiliated with Equity Inns Inc., a publicly traded
Real Estate Investment Trust (NYSE: ENN).
CALL PROTECTION: Prepayment lockout; U.S. Treasury defeasance.
RELEASE PRICE: After the lockout period, Borrowers may partially
defease the Loan to obtain the release of an
individual property. To release a property, the
Borrowers must defease 125% of the loan amount
originally allocated to the property. Further, the
UWDSCR for the remaining properties must be greater
than or equal to 1.90x.
CROSS-COLLATERALIZATION/
DEFAULT: Yes/Yes.
ADDITIONAL FINANCING: None.
CASH MANAGEMENT: Hard Lockbox.
PROPERTY INFORMATION
SINGLE ASSET/PORTFOLIO: Portfolio
PROPERTY TYPE: Hospitality
THE COLLATERAL: 5 AmeriSuites, 3 Homewood Suites, 6 Hampton Inns
and 5 Residence Inns Hospitality properties
containing a total of 2,453 rooms and located in
13 states. Each of the properties is leased to
and managed by an affiliate of either Prime
Hospitality Corp. or Interstate Hotels
Management, Inc.
SUBSTITUTION: The Borrowers may substitute "like-kind"
collateral without penalty after the prepayment
lockout period. Substitution is limited to $25
million in collateral value per substitution and
$50 million in the aggregate. Any substitution is
also subject to maintenance of a minimum LTV of
55% and receipt of confirmation from the Rating
Agencies that such substitution will not effect
the ratings for any Class.
LESSEES: Five of the properties are leased by an affiliate
of Prime Hospitality Corp., a publicly traded
company (NYSE: PDQ), which owns, manages and
franchises hotels. The Prime affiliate manages
each of the five properties.
The remaining 14 properties are leased by
affiliates of Interstate Hotels Management, Inc.,
a publicly traded company (NASDAQ: IHCO). The
Interstate affiliates manage all but three of the
properties, which are managed under contract by a
third party.
UNDERWRITTEN NET CASH
LOAN/PARTICIPATION: $17,808,512 / $8,904,256
APPRAISED VALUE
LOAN/PARTICIPATION: $196,800,000 / $98,400,000
APPRAISAL DATE: April 1, 1999
CUT-OFF DATE LOAN/ROOM
LOAN/PARTICIPATION: $39,485 / $19,742
CUT-OFF DATE LTV: 49.26%
BALLOON LTV: 40.31%
UWNCF DSCR: 1.90x
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting
this material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange
Commission (the "SEC") and incorporated by reference into an effective
registration statement previously filed with the SEC under Rule 415 of the
Securities Act of 1933, including in cases where the material does not pertain
to securities that are ultimately offered for sale pursuant to such
registration statement. Information contained in this material is current as of
the date appearing on this material only. Information in this material
regarding any assets backing any securities discussed herein supersedes all
prior information regarding such assets. All information in this Term Sheet,
whether regarding the assets backing any securities discussed herein or
otherwise, will be superseded by the information contained in any final
prospectus for any securities actually sold to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates
in connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-18
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
EQUITY INNS
- --------------------------------------------------------------------------------
COLLATERAL DETAILS
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------
ALLOCATED CUT-OFF DATE ALLOCATED CUT-OFF
PROPERTY CITY STATE #UNITS PARTICIPATION AMOUNT DATE LOAN AMOUNT
--------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Residence Inn Portland Oregon 168 $5,286,057.59 $10,572,115.17
--------------------------------------------------------------------------------------------------------------
Residence Inn Princeton New Jersey 208 $4,976,581.13 $9,953,162.25
--------------------------------------------------------------------------------------------------------------
Homewood Suites Phoenix Arizona 124 $3,558,979.28 $7,117,958.56
--------------------------------------------------------------------------------------------------------------
Residence Inn Eagan Minnesota 120 $3,244,511.27 $6,489,022.53
--------------------------------------------------------------------------------------------------------------
Amerisuites Glen Allen Virginia 126 $2,700,431.68 $5,400,863.37
--------------------------------------------------------------------------------------------------------------
Residence Inn Tucson Arizona 128 $2,660,499.24 $5,320,998.48
--------------------------------------------------------------------------------------------------------------
Hampton Inn Memphis Tennessee 126 $2,370,989.00 $4,741,978.00
--------------------------------------------------------------------------------------------------------------
Residence Inn Tinton Falls New Jersey 96 $2,346,031.22 $4,692,062.45
--------------------------------------------------------------------------------------------------------------
Amerisuites Columbus Ohio 126 $2,321,073.44 $4,642,143.89
--------------------------------------------------------------------------------------------------------------
Hampton Inn Northville Michigan 125 $2,216,250.77 $4,432,501.55
--------------------------------------------------------------------------------------------------------------
Hampton Inn Overland Park Kansas 134 $2,201,276.11 $4,402,552.21
--------------------------------------------------------------------------------------------------------------
Homewood Suites San Antonio Texas 123 $2,066,504.10 $4,133,008.20
--------------------------------------------------------------------------------------------------------------
Hampton Inn Morgantown West Virginia 108 $2,021,580.10 $4,043,160.19
--------------------------------------------------------------------------------------------------------------
Amerisuites Indianapolis Indiana 126 $1,916,757.44 $3,833,514.88
--------------------------------------------------------------------------------------------------------------
Hampton Inn Kansas City Missouri 120 $1,806,943.20 $3,613,886.39
--------------------------------------------------------------------------------------------------------------
Amerisuites Overland Park Kansas 126 $1,791,968.53 $3,583,937.06
--------------------------------------------------------------------------------------------------------------
Amerisuites Memphis Tennessee 128 $1,727,078.30 $3,454,156.61
--------------------------------------------------------------------------------------------------------------
Homewood Suites Sharonville Ohio 111 $1,657,196.52 $3,314,393.05
--------------------------------------------------------------------------------------------------------------
Hampton Inn Richardson Texas 130 $1,557,365.41 $3,114,730.82
--------------------------------------------------------------------------------------------------------------
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting
this material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange
Commission (the "SEC") and incorporated by reference into an effective
registration statement previously filed with the SEC under Rule 415 of the
Securities Act of 1933, including in cases where the material does not pertain
to securities that are ultimately offered for sale pursuant to such
registration statement. Information contained in this material is current as of
the date appearing on this material only. Information in this material
regarding any assets backing any securities discussed herein supersedes all
prior information regarding such assets. All information in this Term Sheet,
whether regarding the assets backing any securities discussed herein or
otherwise, will be superseded by the information contained in any final
prospectus for any securities actually sold to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates
in connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-19
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
ONE COLORADO PLACE RETAIL-OFFICE
- --------------------------------------------------------------------------------
Loan Information
ORIGINAL CUT-OFF DATE
PRINCIPAL BALANCE (a): $42,670,000 $42,628,093
% OF POOL BY UPB 3.70%
NOTE DATE: June 17, 1999
INTEREST RATE: 8.29%
AMORTIZATION: 30 years
ARD DATE: May 10, 2009
BORROWER/SPONSOR: The Borrower is a single purpose, bankruptcy remote
entity.
CALL PROTECTION: Prepayment lockout; U.S. Treasury
defeasance.
CROSS-COLLATERALIZATION/ No/No
DEFAULT:
MEZZANINE LOAN: There is a $4.13 million mezzanine loan made by GMAC
Commercial Mortgage to the Borrower. The mezzanine
loan is secured by a pledge of the membership
interests in the Borrower
CASH MANAGEMENT: Hard Lockbox in place converting to a Soft Lockbox
once the Mezzanine Loan has been repaid in full. The
Soft Lockbox will revert to a Hard Lockbox at the ARD
Date or upon an Event of Default.
MONTHLY RESERVES: TI/LC - $22,850
Replacement - $2,313
PROPERTY INFORMATION
SINGLE ASSET/PORTFOLIO: Single Asset
PROPERTY TYPE: Anchored Retail / Office
LOCATION: Pasadena, California
YEAR(S) BUILT / RENOVATED: 1890-1930 / 1991-1992
THE COLLATERAL: An outdoor retail shopping, office and
entertainment complex located in the Old Town
district of Pasadena, CA. The buildings in the
complex were originally constructed during the
1890's and 1920's, and all subsequently underwent
comprehensive structural and seismic upgrades.
The complex contains 277,536 of net rentable
square feet, with major tenants including The
Gap, Banana Republic, Armani Exchange, and AMC
Theatres. In addition to the retail and office
space, the collateral also includes a parking
garage.
PROPERTY MANAGEMENT: An affiliate of the Borrower
CURRENT OCCUPANCY (5/17/99): 91%
UNDERWRITTEN NET CASH FLOW: $4,887,329
APPRAISED VALUE: $59,000,000
APPRAISAL DATE: June 10, 1999
CUT-OFF DATE LOAN/SF: $153.59
CUT-OFF DATE LTV: 72.25%
BALLOON LTV: 63.98%
UWNCF DSCR: 1.25x
THREE LARGEST TENANTS
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------
SQUARE PERCENTAGE OF DATE OF
TENANT FOOTAGE LEASED TOTAL LEASABLE AREA LEASE EXPIRATION
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
AMC Theaters 47,883 17.25% 11/19/2006
- ---------------------------------------------------------------------------------------------
Crate & Barrel 26,839 9.67% 01/31/2009
- ---------------------------------------------------------------------------------------------
The Gap 15,279 5.51% 11/30/2007
- ---------------------------------------------------------------------------------------------
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting
this material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange
Commission (the "SEC") and incorporated by reference into an effective
registration statement previously filed with the SEC under Rule 415 of the
Securities Act of 1933, including in cases where the material does not pertain
to securities that are ultimately offered for sale pursuant to such
registration statement. Information contained in this material is current as of
the date appearing on this material only. Information in this material
regarding any assets backing any securities discussed herein supersedes all
prior information regarding such assets. All information in this Term Sheet,
whether regarding the assets backing any securities discussed herein or
otherwise, will be superseded by the information contained in any final
prospectus for any securities actually sold to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates
in connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-20
<PAGE>
ALL INFORMATION IN THIS TERM SHEET, WHETHER REGARDING THE ASSETS BACKING ANY
SECURITIES DISCUSSED HEREIN OR OTHERWISE, WILL BE SUPERSEDED BY THE INFORMATION
CONTAINED IN ANY FINAL PROSPECTUS FOR ANY SECURITIES ACTUALLY SOLD TO YOU.
- --------------------------------------------------------------------------------
COLLATERAL TERM SHEET
COMERICA BANK BUILDING
- --------------------------------------------------------------------------------
LOAN INFORMATION
ORIGINAL CUT-OFF DATE
PRINCIPAL BALANCE (a): $34,000,000 $33,640,510
% OF POOL BY UPB 2.92%
NOTE DATE: April 30, 1999
INTEREST RATE: 7.55%
AMORTIZATION: 30 years
MATURITY DATE: May 1, 2008
BORROWER/SPONSOR: Macanan Investments, LP, a special purpose entity
whose principals directly manage the subject.
CALL PROTECTION: Prepayment lockout; Greater of 1% or Yield
Maintenance.
CROSS-COLLATERALIZATION/
DEFAULT: No/No
MEZZANINE LOAN: There is a $4.2 million mezzanine loan made by German
American Capital Corporation to the principals of the
Borrower and Vanderson Construction, Inc. The
mezzanine loan is secured by a pledge of partnership
interests in the Borrower and a pledge of shareholder
interests in the general partner of the Borrower.
CASH MANAGEMENT: Hard Lockbox in place.
MONTHLY RESERVES: TI/LC - $29,214
Replacement - $3,662
PROPERTY INFORMATION
SINGLE ASSET/PORTFOLIO: Single Asset
PROPERTY TYPE: Office
LOCATION: San Jose, California
YEAR BUILT: 1983
THE COLLATERAL: A twelve-story, 213,575 square foot office tower
with an attached parking garage located in San
Jose, California. The two largest tenants are
Comerica Bank and the State of California, with
the 29 remaining tenants reflecting a diverse mix
of professional, service, and technology-oriented
businesses. In addition to the office building,
the collateral also includes a parking garage.
PROPERTY MANAGEMENT: Macanan Marketing, Inc., an affiliate of the
Borrower.
CURRENT OCCUPANCY (4/30/99): 99%
UNDERWRITTEN NET CASH FLOW: $4,103,369
APPRAISED VALUE: $51,600,000
APPRAISAL DATE: April 29, 1999
CUT-OFF DATE LOAN/SF: $157.51
CUT-OFF DATE LTV: 65.19%
BALLOON LTV: 58.31%
UWNCF DSCR: 1.43x
THREE LARGEST TENANTS
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------
SQUARE PERCENTAGE OF DATE OF
TENANT FOOTAGE LEASED TOTAL LEASEABLE AREA LEASE EXPIRATION
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Comerica Bank 49,426 23.14% 01/31/2003
- ---------------------------------------------------------------------------------------------
State of California 32,424 15.18% 09/30/2011
- ---------------------------------------------------------------------------------------------
Ferrari, Olsen and Ottoboni 14,924 6.99% 03/31/2002
- ---------------------------------------------------------------------------------------------
</TABLE>
This material is for your private information and we are not soliciting any
action based upon it. This material is not to be construed as an offer to sell
or the solicitation of any offer to buy any security in any jurisdiction where
such an offer or solicitation would be illegal. This material is based on
information that we consider reliable, but we do not represent that it is
accurate or complete and it should not be relied upon as such. By accepting
this material the recipient agrees that it will not distribute or provide the
material to any other person. The information contained in this material may be
based on assumptions regarding market conditions and other matters as reflected
therein. We make no representations regarding the reasonableness of such
assumptions or the likelihood that any of such assumptions will coincide with
actual market conditions or events, and this material should not be relied upon
for such purposes. We and our affiliates, officers, directors, partners and
employees, including persons involved in the preparation or issuance of this
material may, from time to time, have long or short positions in, and buy and
sell, the securities mentioned therein or derivatives thereof (including
options). This material may be filed with the Securities and Exchange
Commission (the "SEC") and incorporated by reference into an effective
registration statement previously filed with the SEC under Rule 415 of the
Securities Act of 1933, including in cases where the material does not pertain
to securities that are ultimately offered for sale pursuant to such
registration statement. Information contained in this material is current as of
the date appearing on this material only. Information in this material
regarding any assets backing any securities discussed herein supersedes all
prior information regarding such assets. All information in this Term Sheet,
whether regarding the assets backing any securities discussed herein or
otherwise, will be superseded by the information contained in any final
prospectus for any securities actually sold to you.
This material is furnished to you by Deutsche Bank Securities, Inc. and
Goldman, Sachs & Co. and not by the issuer of the securities. Deutsche Bank
Securities, Inc. and Goldman, Sachs & Co. are acting as the lead managers and
neither of these parties are acting as agent for the issuer or its affiliates
in connection with the proposed transaction. Neither the issuer nor any of its
affiliates has prepared or taken part in the preparation of these materials and
neither makes any representation as to the accuracy of these materials.
C-21
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
ANNEX D
GLOBAL CLEARANCE, SETTLEMENT AND TAX
DOCUMENTATION PROCEDURES
Except in certain limited circumstances, the globally offered GMAC
Commercial Mortgage Securities, Inc. Mortgage Pass-Through Certificates, Series
1999-C3 (the "global securities") will be available only in book-entry form.
Investors in the global securities may hold such global securities through any
of DTC, Cedelbank or Euroclear. The global securities will be tradeable as home
market instruments in both the European and U.S. domestic markets. Initial
settlement and all secondary trades will settle in same day funds. Terms used
but not defined in this Annex D have the meanings assigned to them in the
prospectus supplement and the prospectus.
Secondary market trading between investors holding global securities
through Cedelbank and Euroclear will be conducted in the ordinary way in
accordance with their normal rules and operating procedures and in accordance
with conventional eurobond practice (i.e., seven calendar day settlement).
Secondary market trading between investors holding global securities
through DTC will be conducted according to the rules and procedures applicable
to U.S. corporate debt obligations.
Secondary cross-market trading between Cedelbank or Euroclear and DTC
participants holding certificates will be effected on a
delivery-against-payment basis through the respective depositaries of Cedelbank
and Euroclear (in such capacity) and as DTC participants.
Non-U.S. holders (as described below) of global securities will be subject
to U.S. withholding taxes unless such holders meet certain requirements and
deliver appropriate U.S. tax documents to the securities clearing organizations
or their participants.
INITIAL SETTLEMENT
All global securities will be held in book-entry form by DTC in the name
of Cede & Co. as nominee of DTC. Investors' interests in the global securities
will be represented through financial institutions acting on their behalf as
direct and indirect participants in DTC. As a result, Cedelbank and Euroclear
will hold positions on behalf of their participants through their respective
depositaries, which in turn will hold such positions in accounts as DTC
participants.
Investors electing to hold their global securities through DTC will follow
the settlement practices applicable to similar issues of pass-through
certificates. Investors' securities custody accounts will be credited with
their holdings against payment in same-day funds on the settlement date.
Investors electing to hold their global securities through Cedelbank or
Euroclear accounts will follow the settlement procedures applicable to
conventional eurobonds, except that there will be no temporary global security
and no "lock-up" or restricted period. Global securities will be credited to
the securities custody accounts on the settlement date against payments in
same-day funds.
SECONDARY MARKET TRADING
Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.
Trading between DTC Participants. Secondary market trading between DTC
participants will be settled using the procedures applicable to similar issues
of pass-through certificates in same-day funds.
Trading between Cedelbank and/or Euroclear Participants. Secondary market
trading between Cedelbank participants or Euroclear participants will be
settled using the procedures applicable to conventional eurobonds in same-day
funds.
Trading between DTC seller and Cedelbank or Euroclear purchaser. When
global securities are to be transferred from the account of a DTC participant
to the account of a Cedelbank participant or a Euroclear participant, the
purchaser will send instructions to Cedelbank or Euroclear through a
D-1
<PAGE>
Cedelbank participant or Euroclear participant at least one business day before
settlement. Cedelbank or Euroclear will instruct the respective depositary, as
the case may be, to receive the global securities against payment. Payment will
include interest accrued on the global securities from and including the last
coupon payment date to and excluding the settlement date. Payment will then be
made by the respective depositary to the DTC participant's account against
delivery of the global securities. After settlement has been completed, the
global securities will be credited to the respective clearing system and by the
clearing system, in accordance with its usual procedures, to the Cedelbank
participant's or Euroclear participant's account. The global securities credit
will appear the next day (European time) and the cash debit will be back-valued
to, and the interest on the Global Securities will accrue from, the value date
(which would be the preceding day when settlement occurred in New York). If
settlement is not completed on the intended value date (i.e., the trade fails),
the Cedelbank or Euroclear cash debit will be valued instead as of the actual
settlement date.
Cedelbank participants and Euroclear participants will need to make
available to the respective clearing systems the funds necessary to process
same-day funds settlement. The most direct means of doing so is to pre-position
funds for settlement, either from cash on hand or existing lines of credit, as
they would for any settlement occurring within Cedelbank or Euroclear. Under
this approach, they may take on credit exposure to Cedelbank or Euroclear until
the global securities are credited to their accounts one day later.
As an alternative, if Cedelbank or Euroclear has extended a line of credit
to them, Cedelbank participants or Euroclear participants can elect not to
pre-position funds and allow that credit line to be drawn upon the finance
settlement. Under this procedure, Cedelbank participants or Euroclear
participants purchasing global securities would incur overdraft charges for one
day, assuming they cleared the overdraft when the global securities were
credited to their accounts. However, interest on the global securities would
accrue from the value date. Therefore, in many cases the investment income on
the global securities earned during that one day period may substantially
reduce or offset the amount of such overdraft charges, although this result
will depend on each Cedelbank participant's or Euroclear participant's
particular cost of funds.
Since the settlement is taking place during New York business hours, DTC
participants can employ their usual procedures for sending global securities to
the respective depositary for the benefit of Cedelbank participants or
Euroclear participants. The sale proceeds will be available to the DTC seller
on the settlement date. Thus, to the DTC participant a cross-market transaction
will settle no differently than a trade between two DTC participants.
Trading between Cedelbank or Euroclear seller and DTC purchaser. Due to
time zone differences in their favor, Cedelbank participants and Euroclear
participants may employ their customary procedures for transactions in which
global securities are to be transferred by the respective clearing system,
through the respective depositary, to a DTC participant. The seller will send
instructions to Cedelbank or Euroclear through a Cedelbank participant or
Euroclear participant at least one business day before settlement. In these
cases, Cedelbank or Euroclear will instruct the respective depositary, as
appropriate, to deliver the bonds to the DTC participant's account against
payment. Payment will include interest accrued on the global securities from
and including the last coupon payment date to and excluding the settlement
date. The payment will then be reflected in the account of the Cedelbank
participant or Euroclear participant the following day, and receipt of the cash
proceeds in the Cedelbank participant's or Euroclear participant's account
would be back-valued to the value date (which would be the preceding day, when
settlement occurred in New York). Should the Cedelbank participant or Euroclear
participant have a line of credit with its respective clearing system and elect
to be in debit in anticipation of receipt of the sale proceeds in its account,
the back-valuation will extinguish any overdraft charges incurred over that
one-day period. If settlement is not completed on the intended value date
(i.e., the trade fails), receipt of the cash proceeds in the Cedelbank
participant's or Euroclear participant's account would instead be valued as of
the actual settlement date. Finally, day traders that use Cedelbank or
Euroclear and that purchase global securities from DTC participants for
delivery to Cedelbank participants or Euroclear participants should note that
these trades would automatically fail on the sale side unless affirmative
action were taken. At least three techniques should be readily available to
eliminate this potential problem:
D-2
<PAGE>
(a) borrowing through Cedelbank or Euroclear for one day (until the
purchase side of the day trade is reflected in their Cedelbank or Euroclear
accounts) in accordance with the clearing system's customary procedures;
(b) borrowing the global securities in the U.S. from a DTC participant no
later than one day before settlement, which would give the global
securities sufficient time to be reflected in their Cedelbank or Euroclear
account to settle the sale side of the trade; or
(c) staggering the value dates for the buy and sell sides of the trade so
that the value date for the purchase from the DTC participant is at least
one day before the value date for the sale to the Cedelbank participant or
Euroclear participant.
U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS
A beneficial owner of global securities holding securities through
Cedelbank or Euroclear (or through DTC if the holder has an address outside the
U.S.) will be subject to the 30% U.S. withholding tax that generally applies to
payments of interest (including original issue discount) on registered debt
issued by U.S. persons, unless (1) each clearing system, bank or other
financial institution that holds customers' securities in the ordinary course
of its trade or business in the chain of intermediaries between such beneficial
owner and the U.S. entity required to withhold tax complies with applicable
certification requirements and (2) such beneficial owner takes one of the
following steps to obtain an exemption or reduced tax rate:
Exemption for non-U.S. Persons (Form W-8). Beneficial owners of
certificates that are non-U.S. persons can obtain a complete exemption from the
withholding tax by filing a signed Form W-8 (Certificate of Foreign Status). If
the information shown on Form W-8 changes, a new Form W-8 must be filed within
30 days of such change.
Exemption for non-U.S. Persons with effectively connected income (Form
4224). A non-U.S. person, including a non-U.S. corporation or bank with a U.S.
branch, for which the interest income is effectively connected with its conduct
of a trade or business in the United States can obtain an exemption from the
withholding tax by filing Form 4224 (Exemption from Withholding of Tax on
Income Effectively Connected with the Conduct of a Trade or Business in the
United States).
Exemption or reduced rate for non-U.S. Persons resident in treaty
countries (Form 1001). Non-U.S. Persons that are beneficial owners residing in
a country that has a tax treaty with the United States can obtain an exemption
or reduced tax rate (depending on the treaty terms) by filing Form 1001
(Ownership, Exemption or Reduced Rate Certificate). If the treaty provides only
for a reduced rate, withholding tax will be imposed at that rate unless the
filer alternatively files Form W-8. Form 1001 may be filed by the Beneficial
Owner or his agent.
Exemption for U.S. Persons (Form W-9). U.S. persons can obtain a complete
exemption from the withholding tax by filing Form W-9 (Payer's Request for
Taxpayer Identification Number and Certification).
U.S. Federal Income Tax Reporting Procedure. The beneficial owner of a
global security or, in the case of a Form 1001 or a Form 4224 filer, his agent,
files by submitting the appropriate form to the person through whom it holds
(the clearing agency, in the case of persons holding directly on the books of
the clearing agency). Form W-8 and Form 1001 are effective for three calendar
years and Form 4224 is effective for one calendar year.
The term "U.S. Person" means a citizen or resident of the United States, a
corporation or partnership (unless, in the case of a partnership, Treasury
regulations are adopted that provide otherwise) created or organized in or
under the laws of the United States, any State thereof or the District of
Columbia, including an entity treated as a corporation or partnership for
federal income tax purposes, an estate whose income is subject to United States
federal income tax regardless of its source, or a trust if a court within the
United States is able to exercise primary supervision over the administration
of such trust, and one or more such U. S. Persons have the authority to control
all substantial decisions of such trust (or, to the extent provided in
applicable Treasury regulations, certain trusts in existence on August 20, 1996
D-3
<PAGE>
which are eligible to elect to be treated as U.S. Persons). This summary does
not deal with all aspects of U.S. federal income tax withholding that may be
relevant to foreign holders of the global securities. Investors are advised to
consult their own tax advisors for specific tax advice concerning their holding
and disposing of the global securities.
D-4
<PAGE>
GMAC COMMERCIAL MORTGAGE SECURITIES, INC.
MORTGAGE PASS-THROUGH CERTIFICATES
The mortgage pass-through certificates (the "Offered Certificates")
offered hereby and by the supplements hereto (each, a "Prospectus Supplement")
will be offered from time to time in series. The Offered Certificates of any
series, together with any other mortgage pass-through certificates of such
series, are collectively referred to herein as the "Certificates".
Each series of Certificates will represent in the aggregate the entire
beneficial ownership interest in a trust fund (with respect to any series, the
"Trust Fund") to be formed by GMAC Commercial Mortgage Securities, Inc. (the
"Depositor") and consisting primarily of a segregated pool (a "Mortgage Asset
Pool") of the Mortgage Loans (as defined in the related Prospectus Supplement),
mortgage-backed securities ("MBS") that evidence interests in, or that are
secured by pledges of, one or more of various types of multifamily or
commercial mortgage loans, or a combination of Mortgage Loans and MBS
(collectively, "Mortgage Assets"). If so specified in the related Prospectus
Supplement, the Trust Fund for a series of Certificates may include letters of
credit, insurance policies, guarantees, reserve funds or other types of credit
support, or any combination thereof, and also interest rate exchange agreements
and other financial assets, or any combination thereof. See "Description of the
Trust Funds", "Description of the Certificates" and "Description of Credit
Support".
The yield on each class of Certificates of a series will be affected by,
among other things, the rate of payment of principal (including prepayments) on
the Mortgage Assets in the related Trust Fund and the timing of receipt of such
payments as described herein and in the related Prospectus Supplement. See
"Yield and Maturity Considerations". A Trust Fund may be subject to early
termination under the circumstances described herein and in the related
Prospectus Supplement. See "Description of the Certificates--Termination;
Retirement of the Certificates".
Retain this Prospectus for future reference. This Prospectus may not be
used to consummate sales of the Offered Certificates of any series unless
accompanied by the Prospectus Supplement for such series.
(cover continued on next page)
--------------
PROCEEDS OF THE ASSETS IN THE TRUST FUND ARE THE SOLE SOURCE OF PAYMENTS
ON THE OFFERED CERTIFICATES. THE OFFERED CERTIFICATES DO NOT REPRESENT AN
INTEREST IN OR OBLIGATION OF THE DEPOSITOR, THE MASTER SERVICER, GMAC
COMMERCIAL MORTGAGE CORPORATION OR ANY OF THEIR AFFILIATES. NEITHER THE OFFERED
CERTIFICATES NOR THE MORTGAGE ASSETS WILL BE GUARANTEED OR INSURED BY THE
DEPOSITOR, THE MASTER SERVICER, GMAC COMMERCIAL MORTGAGE CORPORATION OR ANY OF
THEIR AFFILIATES OR, UNLESS OTHERWISE SPECIFIED IN THE RELATED PROSPECTUS
SUPPLEMENT, BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
PROSPECTIVE INVESTORS SHOULD REVIEW THE INFORMATION APPEARING ON PAGE 11 HEREIN
UNDER THE CAPTION "RISK FACTORS" AND SUCH INFORMATION AS MAY BE SET FORTH UNDER
THE CAPTION "RISK FACTORS" IN THE RELATED PROSPECTUS SUPPLEMENT BEFORE
PURCHASING ANY OFFERED CERTIFICATE.
--------------
The Offered Certificates of any series may be offered through one or more
different methods, including offerings through underwriters, as described under
"Method of Distribution" and in the related Prospectus Supplement.
The date of this Prospectus is November 5, 1998
<PAGE>
(cover continued)
There will be no secondary market for the Offered Certificates of any
series prior to the offering thereof. There can be no assurance that a
secondary market for any Offered Certificates will develop or, if it does
develop, that it will continue. The Certificates will not be listed on any
securities exchange.
As described in the related Prospectus Supplement, the Certificates of
each series, including the Offered Certificates of such series, may consist of
one or more classes of Certificates that: (i) provide for the accrual of
interest thereon based on a fixed, variable or adjustable interest rate; (ii)
are senior or subordinate to one or more other classes of Certificates in
entitlement to certain distributions on the Certificates; (iii) are entitled to
distributions of principal, with disproportionate, nominal or no distributions
of interest; (iv) are entitled to distributions of interest, with
disproportionate, nominal or no distributions of principal; (v) provide for
distributions of interest thereon or principal thereof that commence only
following the occurrence of certain events, such as the retirement of one or
more other classes of Certificates of such series; (vi) provide for
distributions of principal thereof to be made, from time to time or for
designated periods, at a rate that is faster (and, in some cases, substantially
faster) or slower (and, in some cases, substantially slower) than the rate at
which payments or other collections of principal are received on the Mortgage
Assets in the related Trust Fund; or (vii) provide for distributions of
principal thereof to be made, subject to available funds, based on a specified
principal payment schedule or other methodology. Distributions in respect of
the Certificates of each series will be made on a monthly, quarterly,
semi-annual, annual or other periodic basis as specified in the related
Prospectus Supplement. See "Description of the Certificates".
If so provided in the related Prospectus Supplement, one or more elections
may be made to treat the related Trust Fund or a designated portion thereof as
a "real estate mortgage investment conduit" (each, a "REMIC") for federal
income tax purposes. If applicable, the Prospectus Supplement for a series of
Certificates will specify which class or classes of such series of Certificates
will be considered to be regular interests in the related REMIC and which class
of Certificates or other interests will be designated as the residual interest
in the related REMIC. See "Certain Federal Income Tax Consequences".
2
<PAGE>
PROSPECTUS SUPPLEMENT
As more particularly described herein, the Prospectus Supplement relating
to each series of Offered Certificates will, among other things, set forth, as
and to the extent appropriate: (i) a description of the class or classes of
such Offered Certificates, including the payment provisions with respect to
each such class, the aggregate principal amount, if any, of each such class,
the rate at which interest accrues from time to time, if at all, with respect
to each such class or the method of determining such rate, and whether interest
with respect to each such class will accrue from time to time on its aggregate
principal amount, if any, or on a specified notional amount, if at all; (ii)
information with respect to any other classes of Certificates of the same
series; (iii) the respective dates on which distributions are to be made; (iv)
information as to the assets, including the Mortgage Assets, constituting the
related Trust Fund (all such assets, with respect to the Certificates of any
series, the "Trust Assets"); (v) the circumstances, if any, under which the
related Trust Fund may be subject to early termination; (vi) additional
information with respect to the method of distribution of such Offered
Certificates; (vii) whether one or more REMIC elections will be made and the
designation of the "regular interests" and "residual interests" in each REMIC
to be created; (viii) the initial percentage ownership interest in the related
Trust Fund to be evidenced by each class of Certificates of such series; (ix)
information concerning the Trustee (as defined herein) of the related Trust
Fund; (x) if the related Trust Fund includes Mortgage Loans, information
concerning the Master Servicer and any Special Servicer (each as defined
herein) of such Mortgage Loans; (xi) information as to the nature and extent of
subordination of any class of Certificates of such series, including a class of
Offered Certificates; and (xii) whether such Offered Certificates will be
initially issued in definitive or book-entry form.
AVAILABLE INFORMATION
The Depositor has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement (of which this Prospectus forms a part)
under the Securities Act of 1933, as amended, with respect to the Offered
Certificates. This Prospectus and the Prospectus Supplement relating to each
series of Offered Certificates contain summaries of the material terms of the
documents referred to herein and therein, but do not contain all of the
information set forth in the Registration Statement pursuant to the rules and
regulations of the Commission. For further information, reference is made to
such Registration Statement and the exhibits thereto. Such Registration
Statement and exhibits can be inspected and copied at prescribed rates at the
public reference facilities maintained by the Commission at its Public
Reference Section, 450 Fifth Street, N.W., Washington, D.C. 20549, and at its
Midwest Regional Offices located as follows: Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661-2511; and Northeast Regional
Office, Seven World Trade Center, Suite 1300, New York, New York 10048. The
Commission maintains a Web site at http://www.sec.gov containing reports, proxy
and information statements and other information regarding registrants,
including the Depositor, that file electronically with the Commission.
No dealer, salesman, or any other person has been authorized to give any
information, or to make any representations, other than those contained in this
Prospectus or any related Prospectus Supplement, and, if given or made, such
information or representations must not be relied upon as having been
authorized by the Depositor or any dealer, salesman, or any other person.
Neither the delivery of this Prospectus or any related Prospectus Supplement
nor any sale made hereunder or thereunder shall under any circumstances create
an implication that there has been no change in the information herein or
therein since the date hereof. This Prospectus and any related Prospectus
Supplement are not an offer to sell or a solicitation of an offer to buy any
security in any jurisdiction in which it is unlawful to make such offer or
solicitation.
The Master Servicer or another specified person will cause to be provided
to registered holders of the Offered Certificates of each series periodic
unaudited reports concerning the related Trust Fund.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
There are incorporated herein by reference all documents and reports filed
or caused to be filed by the Depositor with respect to a Trust Fund pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act of 1934, as amended,
prior to the termination of an offering of Offered Certificates evidencing
interests therein. The Depositor will provide or cause to be provided without
charge to each person to whom this Prospectus is delivered in connection with
the offering of one or more classes of Offered Certificates, upon written or
oral request of such person, a copy of any or all documents or reports
incorporated herein by reference, in each case to the extent such documents or
reports relate to one or more of such classes of such Offered Certificates,
other than the exhibits to such documents (unless such exhibits are
specifically incorporated by reference in such documents). Requests to the
Depositor should be directed in writing to its principal executive offices at
650 Dresher Road, Horsham, Pennsylvania 19044, or by telephone at (215)
328-3164.
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SUMMARY OF PROSPECTUS
The following summary of certain pertinent information is qualified in its
entirety by reference to the more detailed information appearing elsewhere in
this Prospectus and by reference to the information with respect to each series
of Certificates contained in the Prospectus Supplement to be prepared and
delivered in connection with the offering of Offered Certificates of such
series. An Index of Principal Definitions is included at the end of this
Prospectus.
SECURITIES OFFERED.......... Mortgage pass-through certificates.
DEPOSITOR................... GMAC Commercial Mortgage Securities, Inc., an
indirect wholly-owned subsidiary of GMAC
Commercial Mortgage Corporation ("GMACCM"). See
"The Depositor".
TRUSTEE..................... The trustee (the "Trustee") for each series of
Certificates will be named in the related
Prospectus Supplement. See "The Pooling and
Servicing Agreements--The Trustee".
MASTER SERVICER............. If a Trust Fund includes Mortgage Loans, then
the servicer or the master servicer (each, a
"Master Servicer") for the corresponding series
of Certificates will be named in the related
Prospectus Supplement. The Master Servicer for
any series of Certificates may be GMACCM or
another affiliate of the Depositor. The Master
Servicer may also be the Special Servicer for
such series and, in such dual capacity, would be
referred to as the "Servicer". See "GMAC
Commercial Mortgage Corporation" and "The Pooling
and Servicing Agreements--Certain Matters
Regarding the Master Servicer and the Depositor".
SPECIAL SERVICER............ If a Trust Fund includes Mortgage Loans, then
any special servicers (each, a "Special
Servicer") for the corresponding series of
Certificates will be named, or the circumstances
under which a Special Servicer may be appointed
will be described, in the related Prospectus
Supplement. A Special Servicer for any series of
Certificates may be the Master Servicer or an
affiliate of the Depositor or the Master
Servicer. See "The Pooling and Servicing
Agreements--Special Servicers".
MBS ADMINISTRATOR........... If a Trust Fund includes MBS, then the entity
responsible for administering such MBS (the "MBS
Administrator") will be named in the related
Prospectus Supplement. If an entity other than
the Trustee and the Master Servicer is the MBS
Administrator, such entity will be herein
referred to as the "Manager". The Manager for any
series of Certificates may be GMACCM or another
affiliate of the Depositor.
THE MORTGAGE ASSETS......... The Mortgage Assets will be the primary asset
of any Trust Fund. The Mortgage Assets with
respect to each series of Certificates will, in
general, consist of a pool of Mortgage Loans
secured by first or junior liens on, as described
herein, multifamily residential properties or
commercial properties. If so specified in the
related Prospectus Supplement, a Trust Fund
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may include Mortgage Loans secured by liens on
real estate projects under construction. The
Mortgage Loans will not be guaranteed or insured
by the Depositor, GMACCM or any of their
affiliates or, unless otherwise provided in the
related Prospectus Supplement, by any
governmental agency or instrumentality or by any
other person. If so specified in the related
Prospectus Supplement, some Mortgage Loans may
be delinquent or non-performing as of the date
the related Trust Fund is formed.
As and to the extent described in the related
Prospectus Supplement, a Mortgage Loan (i) may
provide for no accrual of interest or for
accrual of interest thereon at an interest rate
(a "Mortgage Rate") that is fixed over its term
or that adjusts from time to time, or that may
be converted at the borrower's election from an
adjustable to a fixed Mortgage Rate, or from a
fixed to an adjustable Mortgage Rate, (ii) may
provide for level payments to maturity or for
payments that adjust from time to time to
accommodate changes in the Mortgage Rate or to
reflect the occurrence of certain events, and
may permit negative amortization, (iii) may be
fully amortizing or may be partially amortizing
or non-amortizing, with a balloon payment due on
its stated maturity date, (iv) may prohibit over
its term or for a certain period prepayments
and/or require payment of a premium or a yield
maintenance penalty in connection with certain
prepayments and (v) may provide for payments of
principal, interest or both, on due dates that
occur monthly, quarterly, semi-annually or at
such other interval as is specified in the
related Prospectus Supplement. Unless otherwise
provided in the related Prospectus Supplement,
each Mortgage Loan will have had an original
term to maturity of not more than 40 years.
Unless otherwise provided in the related
Prospectus Supplement, no Mortgage Loan will
have been originated by the Depositor; however,
some or all of the Mortgage Loans in any Trust
Fund may have been originated by GMACCM or
another affiliate of the Depositor. See
"Description of the Trust Funds--Mortgage
Loans".
If and to the extent specified in the related
Prospectus Supplement, the Mortgage Assets with
respect to a series of Certificates may also
include, or consist of, MBS, provided that each
MBS will evidence an interest in, or will be
secured by a pledge of, one or more mortgage
loans that conform to the descriptions of the
Mortgage Loans contained herein. See
"Description of the Trust Funds--MBS".
THE CERTIFICATES............ Each series of Certificates will be issued in
one or more classes pursuant to a pooling and
servicing agreement or other agreement specified
in the related Prospectus Supplement (in either
case, a "Pooling And Servicing Agreement") and
will represent in the aggregate the entire
beneficial ownership interest in the related
Trust Fund.
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As described in the related Prospectus
Supplement, the Certificates of each series,
including the Offered Certificates of such
series, may consist of one or more classes of
Certificates that, among other things: (i) are
senior (collectively, "Senior Certificates") or
subordinate (collectively, "Subordinate
Certificates") to one or more other classes of
Certificates in entitlement to certain
distributions on the Certificates; (ii) are
entitled to distributions of principal, with
disproportionate, nominal or no distributions of
interest (collectively, "Stripped Principal
Certificates"); (iii) are entitled to
distributions of interest, with
disproportionate, nominal or no distributions of
principal (collectively, "Stripped Interest
Certificates"); (iv) provide for distributions
of interest thereon or principal thereof that
commence only after the occurrence of certain
events, such as the retirement of one or more
other classes of Certificates of such series;
(v) provide for distributions of principal
thereof to be made, from time to time or for
designated periods, at a rate that is faster
(and, in some cases, substantially faster) or
slower (and, in some cases, substantially
slower) than the rate at which payments or other
collections of principal are received on the
Mortgage Assets in the related Trust Fund; (vi)
provide for distributions of principal thereof
to be made, subject to available funds, based on
a specified principal payment schedule or other
methodology; or (vii) provide for distribution
based on collections on the Mortgage Assets in
the related Trust Fund attributable to
prepayment premiums, yield maintenance penalties
or equity participations.
Each class of Certificates, other than certain
classes of Stripped Interest Certificates and
certain classes of REMIC Residual Certificates
(as defined herein), will have an initial stated
principal amount (a "Certificate Balance"); and
each class of Certificates, other than certain
classes of Stripped Principal Certificates and
certain classes of REMIC Residual Certificates,
will accrue interest on its Certificate Balance
or, in the case of certain classes of Stripped
Interest Certificates, on a notional amount (a
"Notional Amount") based on a fixed, variable or
adjustable interest rate (a "Pass-Through
Rate"). The related Prospectus Supplement will
specify the Certificate Balance, Notional Amount
and/or Pass-Through Rate (or, in the case of a
variable or adjustable Pass-Through Rate, the
method for determining such rate), as
applicable, for each class of Offered
Certificates.
If so specified in the related Prospectus
Supplement, a class of Certificates may have two
or more component parts, each having
characteristics that are otherwise described
herein as being attributable to separate and
distinct classes.
The Certificates will not be guaranteed or
insured by the Depositor, by the Master
Servicer, by GMACCM or any of their affiliates,
by any governmental agency or instrumentality or
by any other person or entity, unless otherwise
provided in the related Prospectus Supplement.
See "Risk Factors--Limited Obligations".
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<PAGE>
DISTRIBUTIONS OF INTEREST ON THE
CERTIFICATES............... Interest on each class of Offered Certificates
(other than certain classes of Stripped Principal
Certificates and certain classes of REMIC
Residual Certificates) of each series will accrue
at the applicable Pass-Through Rate on the
Certificate Balance or, in the case of certain
classes of Stripped Interest Certificates, the
Notional Amount thereof outstanding from time to
time and will be distributed to
Certificateholders as provided in the related
Prospectus Supplement (each of the specified
dates on which distributions are to be made, a
"Distribution Date"). Distributions of interest
with respect to one or more classes of
Certificates (collectively, "Accrual
Certificates") may not commence until the
occurrence of certain events, such as the
retirement of one or more other classes of
Certificates, and interest accrued with respect
to a class of Accrual Certificates prior to the
occurrence of such an event will either be added
to the Certificate Balance thereof or otherwise
deferred as described in the related Prospectus
Supplement. Distributions of interest with
respect to one or more classes of Certificates
may be reduced to the extent of certain
delinquencies, losses and other contingencies
described herein and in the related Prospectus
Supplement. See "Risk Factors--Yield and
Prepayment Considerations", "Yield and Maturity
Considerations--Certain Shortfalls in Collections
of Interest" and "Description of the
Certificates--Distributions of Interest on the
Certificates".
DISTRIBUTIONS OF PRINCIPAL OF THE
CERTIFICATES............... As and to the extent described in each
Prospectus Supplement, distributions of principal
with respect to the related series of
Certificates will be made on each Distribution
Date to the holders of the class or classes of
Certificates of such series entitled thereto
until the Certificate Balances of such
Certificates have been reduced to zero.
Distributions of principal with respect to one or
more classes of Certificates: (i) may be made at
a rate that is faster (and, in some cases,
substantially faster) or slower (and, in some
cases, substantially slower) than the rate at
which payments or other collections of principal
are received on the Mortgage Assets in the
related Trust Fund; (ii) may not commence until
the occurrence of certain events, such as the
retirement of one or more other classes of
Certificates of the same series; (iii) may be
made, subject to certain limitations, based on a
specified principal payment schedule; or (iv) may
be contingent on the specified principal payment
schedule for another class of the same series and
the rate at which payments and other collections
of principal on the Mortgage Assets in the
related Trust Fund are received. Unless otherwise
specified in the related Prospectus Supplement,
distributions of principal of any class of
Offered Certificates will be made on a pro rata
basis among all of the Certificates of such
class. See "Description of the
Certificates--Distributions of Principal of the
Certificates".
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<PAGE>
CREDIT SUPPORT AND CASH FLOW
AGREEMENTS................. If so provided in the related Prospectus
Supplement, partial or full protection against
certain defaults and losses on the Mortgage
Assets in the related Trust Fund may be provided
to one or more classes of Certificates of the
related series in the form of subordination of
one or more other classes of Certificates of such
series, which other classes may include one or
more classes of Offered Certificates, or by one
or more other types of credit support, such as a
letter of credit, insurance policy, guarantee,
reserve fund or another type of credit support,
or a combination thereof (any such coverage with
respect to the Certificates of any series,
"Credit Support"). If so provided in the related
Prospectus Supplement, a Trust Fund may include:
(i) guaranteed investment contracts pursuant to
which moneys held in the funds and accounts
established for the related series will be
invested at a specified rate; or (ii) certain
other agreements, such as interest rate exchange
agreements, interest rate cap or floor
agreements, or other agreements designed to
reduce the effects of interest rate fluctuations
on the Mortgage Assets or on one or more classes
of Certificates (any such agreement, in the case
of clause (i) or (ii), a "Cash Flow Agreement").
Certain relevant information regarding any
applicable Credit Support or Cash Flow Agreement
will be set forth in the Prospectus Supplement
for a series of Offered Certificates. See "Risk
Factors--Credit Support Limitations",
"Description of the Trust Funds--Credit Support"
and "--Cash Flow Agreements" and "Description of
Credit Support".
ADVANCES.................... If and to the extent provided in the related
Prospectus Supplement, if a Trust Fund includes
Mortgage Loans, the Master Servicer, a Special
Servicer, the Trustee, any provider of Credit
Support and/or any other specified person may be
obligated to make, or have the option of making,
certain advances with respect to delinquent
scheduled payments of principal and/or interest
on such Mortgage Loans. Any such advances made
with respect to a particular Mortgage Loan will
be reimbursable from subsequent recoveries in
respect of such Mortgage Loan and otherwise to
the extent described herein and in the related
Prospectus Supplement. See "Description of the
Certificates-Advances in respect of
Delinquencies". If and to the extent provided in
the Prospectus Supplement for a series of
Certificates, any entity making such advances
may be entitled to receive interest thereon for
a specified period during which certain or all
of such advances are outstanding, payable from
amounts in the related Trust Fund. See
"Description of the Certificates-Advances in
Respect of Delinquencies". If a Trust Fund
includes MBS, any comparable advancing
obligation of a party to the related Pooling and
Servicing Agreement, or of a party to the
related MBS Agreement, will be described in the
related Prospectus Supplement.
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<PAGE>
OPTIONAL TERMINATION........ The Master Servicer, the Depositor or, if
specified in the related Prospectus Supplement,
the holder of the residual interest in a REMIC
may at its option either (i) effect early
retirement of a series of Certificates through
the purchase of the assets in the related Trust
Fund or (ii) purchase, in whole but not in part,
the Certificates specified in the related
Prospectus Supplement; in each case under the
circumstances and in the manner set forth herein
under "Description of the
Certificates--Termination; Retirement of
Certificates" and in the related Prospectus
Supplement.
CERTAIN FEDERAL INCOME TAX
CONSEQUENCES............... The Certificates of each series will constitute
"regular interests" ("REMIC Regular
Certificates") and "residual interests" ("REMIC
Residual Certificates") in a Trust Fund, or a
designated portion thereof, treated as a REMIC
under Sections 860A through 860G of the Internal
Revenue Code of 1986 (the "Code").
Investors are advised to consult their tax
advisors and to review "Certain Federal Income
Tax Consequences" herein and in the related
Prospectus Supplement.
ERISA CONSIDERATIONS........ Fiduciaries of employee benefit plans and
certain other retirement plans and arrangements,
including individual retirement accounts,
annuities, Keogh plans, and collective investment
funds and separate accounts (and, as applicable,
insurance company general accounts) in which such
plans, accounts, annuities or arrangements are
invested, that are subject to the Employee
Retirement Income Security Act of 1974, as
amended ("ERISA"), or Section 4975 of the Code,
should review with their legal advisors whether
the purchase or holding of Offered Certificates
could give rise to a transaction that is
prohibited or is not otherwise permissible either
under ERISA or Section 4975 of the Code. See
"ERISA Considerations" herein and in the related
Prospectus Supplement.
LEGAL INVESTMENT............ The Offered Certificates will constitute
"Mortgage Related Securities" for purposes of the
Secondary Mortgage Market Enhancement Act of
1984, as amended ("SMMEA"), only if so specified
in the related Prospectus Supplement. Investors
whose investment authority is subject to legal
restrictions should consult their legal advisors
to determine whether and to what extent the
Offered Certificates constitute legal investments
for them. See "Legal Investment" herein and in
the related Prospectus Supplement.
RATING...................... At their respective dates of issuance, each
class of Offered Certificates will be rated not
lower than investment grade by one or more
nationally recognized statistical rating agencies
(each, a "Rating Agency"). See "Rating" herein
and in the related Prospectus Supplement.
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RISK FACTORS
In considering an investment in the Offered Certificates of any series,
investors should consider, among other things, the following risk factors and
any other factors set forth under the heading "Risk Factors" in the related
Prospectus Supplement. In general, to the extent that the factors discussed
below pertain to or are influenced by the characteristics or behavior of
Mortgage Loans included in a particular Trust Fund, they would similarly
pertain to and be influenced by the characteristics or behavior of the mortgage
loans underlying any MBS included in such Trust Fund.
LIMITED LIQUIDITY
There can be no assurance that a secondary market for the Offered
Certificates of any series will develop or, if it does develop, that it will
provide holders with liquidity of investment or that it will continue for as
long as such Certificates remain outstanding. The Prospectus Supplement for any
series of Offered Certificates may indicate that an underwriter specified
therein intends to establish a secondary market in such Offered Certificates;
however, no underwriter will be obligated to do so. The Certificates will not
be listed on any securities exchange.
LIMITED OBLIGATIONS
The Certificates will not represent an interest in or obligation of the
Depositor, the Master Servicer, GMACCM or any of their affiliates. The only
obligations of the foregoing entities with respect to the Certificates or the
Mortgage Assets will be the obligations (if any) of the Depositor and the
Master Servicer pursuant to certain limited representations and warranties made
with respect to the Mortgage Assets, the Master Servicer's servicing
obligations under the related Pooling and Servicing Agreement (including its
limited obligation to make certain advances in the event of delinquencies on
the Mortgage Loans, but only to the extent deemed recoverable) and pursuant to
the terms of any MBS, and such other limited obligations of the Master Servicer
and the Depositor as may be described in the related Prospectus Supplement.
Neither the Certificates nor the underlying Mortgage Assets will be guaranteed
or insured by the Depositor, the Master Servicer, GMACCM or any of their
affiliates or, unless otherwise specified in the related Prospectus Supplement,
by any governmental agency or instrumentality. Proceeds of the Trust Assets
included in the related Trust Fund for each series of Certificates (including
the Mortgage Assets, any fund or instrument constituting Credit Support and any
Cash Flow Agreements) will be the sole source of payments on the Certificates,
and there will be no recourse to the Depositor, the Master Servicer, GMACCM or
any other entity in the event that such proceeds are insufficient or otherwise
unavailable to make all payments provided for under the Certificates.
CREDIT SUPPORT LIMITATIONS
The Prospectus Supplement for a series of Certificates will describe any
Credit Support provided with respect thereto. Use of Credit Support will be
subject to the conditions and limitations described herein and in the related
Prospectus Supplement. Moreover, such Credit Support may not cover all
potential losses; for example, Credit Support may or may not cover loss by
reason of fraud or negligence by a mortgage loan originator or other parties.
A series of Certificates may include one or more classes of Subordinate
Certificates (which may include Offered Certificates), if so provided in the
related Prospectus Supplement. Although subordination is intended to reduce the
likelihood of temporary shortfalls and ultimate losses to holders of Senior
Certificates, the amount of subordination will be limited and may decline under
certain circumstances. In addition, if principal payments on one or more
classes of Offered Certificates of a series are made in a specified order of
priority, any related Credit Support may be exhausted before the principal of
the later paid classes of Offered Certificates of such series has been repaid
in full. As a result, the impact of losses and shortfalls experienced with
respect to the Mortgage Assets may fall primarily upon those classes of Offered
Certificates having a later right of payment. Moreover, if a form of Credit
Support covers the Offered Certificates of more than one series and losses on
the related Mortgage Assets exceed the amount of such Credit Support, it is
possible that the holders of Offered Certificates of one (or more) such series
will be disproportionately benefited by such Credit Support to the detriment of
the holders of Offered Certificates of one (or more) other such series.
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The amount of any applicable Credit Support supporting one or more classes
of Offered Certificates, including the subordination of one or more classes of
Certificates, will be determined on the basis of criteria established by each
Rating Agency rating such classes of Certificates based on an assumed level of
defaults, delinquencies and losses on the underlying Mortgage Assets and
certain other factors. There can, however, be no assurance that the loss
experience on the related Mortgage Assets will not exceed such assumed levels.
See "Description of the Certificates--Allocation of Losses and Shortfalls" and
"Description of Credit Support".
YIELD AND PREPAYMENT CONSIDERATIONS
The yield to maturity of the Offered Certificates of each series will
depend on the rate and timing of principal payments (including prepayments,
liquidations due to defaults, and repurchases for breaches of representations
and warranties or document defects) on the Mortgage Loans and the price paid by
Certificateholders. Such yield may be adversely affected by a higher or lower
than anticipated rate of prepayments on the related Mortgage Loans. The yield
to maturity on Stripped Interest Certificates and Stripped Principal
Certificates will be extremely sensitive to the rate of prepayments on the
related Mortgage Loans. In addition, the yield to maturity on certain other
types of classes of Certificates, including Accrual Certificates, Certificates
with a Pass-Through Rate which fluctuates inversely with an index or certain
other classes in a series including more than one class of Certificates, may be
relatively more sensitive to the rate of prepayment on the related Mortgage
Loans than other classes of Certificates. The rate of principal payments on
pools of mortgage loans varies among pools and from time to time is influenced
by a variety of economic, demographic, geographic, social, tax, legal and other
factors, including prevailing mortgage market interest rates and the particular
terms of the Mortgage Loans (e.g., provisions that prohibit voluntary
prepayments during specified periods or impose penalties in connection
therewith). There can be no assurance as to the actual rate of prepayment on
the Mortgage Loans in any Trust Fund or that such rate of prepayment will
conform to any model described herein or in any Prospectus Supplement. See
"Yield and Maturity Considerations" herein.
INVESTMENT IN COMMERCIAL AND MULTIFAMILY MORTGAGE LOANS
A description of certain material considerations associated with
investments in mortgage loans is included herein under "Certain Legal Aspects
of Mortgage Loans". Mortgage loans made on the security of multifamily or
commercial property may have a greater likelihood of delinquency and
foreclosure, and a greater likelihood of loss in the event thereof, than loans
made on the security of an owner-occupied single-family property. See
"Description of the Trust Funds--Mortgage Loans--Default and Loss
Considerations with Respect to the Mortgage Loans". The ability of a borrower
to repay a loan secured by an income-producing property typically is dependent
primarily upon the successful operation of such property rather than upon the
existence of independent income or assets of the borrower; thus, the value of
an income-producing property is directly related to the net operating income
derived from such property. If the net operating income of the property is
reduced (for example, if rental or occupancy rates decline or real estate tax
rates or other operating expenses increase), the borrower's ability to repay
the loan may be impaired. A number of the Mortgage Loans may be secured by
liens on owner-occupied Mortgaged Properties or on Mortgaged Properties leased
to a single tenant or a small number of significant tenants. Accordingly, a
decline in the financial condition of the borrower or a significant tenant, as
applicable, may have a disproportionately greater effect on the net operating
income from such Mortgaged Properties than would be the case with respect to
Mortgaged Properties with multiple tenants. Furthermore, the value of any
Mortgaged Property may be adversely affected by factors generally incident to
interests in real property, including changes in general or local economic
conditions and/or specific industry segments; declines in real estate values;
declines in rental or occupancy rates; increases in interest rates, real estate
tax rates and other operating expenses; changes in governmental rules,
regulations and fiscal policies, including environmental legislation; natural
disasters and civil disturbances such as earthquakes, hurricanes, floods,
eruptions or riots; and other circumstances, conditions or events beyond the
control of a Master Servicer.
Additional considerations may be presented by the type and use of a
particular Mortgaged Property. For instance, Mortgaged Properties that operate
as hospitals and nursing homes are subject to significant
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governmental regulation of the ownership, operation, maintenance and financing
of health care institutions. Hotel and motel properties are often operated
pursuant to franchise, management or operating agreements that may be
terminable by the franchisor or operator, and the transferability of a hotel's
operating, liquor and other licenses upon a transfer of the hotel, whether
through purchase or foreclosure, is subject to local law requirements.
It is anticipated that some or all of the Mortgage Loans included in any
Trust Fund will be nonrecourse loans or loans for which recourse may be
restricted or unenforceable. As to any such Mortgage Loan, recourse in the
event of borrower default will be limited to the specific real property and
other assets, if any, that were pledged to secure the Mortgage Loan. However,
even with respect to those Mortgage Loans that provide for recourse against the
borrower and its assets generally, there can be no assurance that enforcement
of such recourse provisions will be practicable, or that the assets of the
borrower will be sufficient to permit a recovery in respect of a defaulted
Mortgage Loan in excess of the liquidation value of the related Mortgaged
Property. See "Certain Legal Aspects of Mortgage Loans--
Foreclosure--Anti-Deficiency Legislation".
Further, the concentration of default, foreclosure and loss risks in
individual Mortgage Loans in a particular Trust Fund will generally be greater
than for pools of single-family loans because Mortgage Loans in a Trust Fund
will generally consist of a smaller number of higher balance loans than would a
pool of single-family loans of comparable aggregate unpaid principal balance.
BALLOON PAYMENTS; BORROWER DEFAULT
Certain of the Mortgage Loans included in a Trust Fund may be
non-amortizing or only partially amortizing over their terms to maturity and,
thus, will require substantial payments of principal and interest (that is,
balloon payments) at their stated maturity. Mortgage Loans of this type involve
a greater likelihood of default than self-amortizing loans because the ability
of a borrower to make a balloon payment typically will depend upon its ability
either to refinance the loan or to sell the related Mortgaged Property. The
ability of a borrower to accomplish either of these goals will be affected by a
number of factors, including the value of the related Mortgaged Property, the
level of available mortgage rates at the time of sale or refinancing, the
borrower's equity in the related Mortgaged Property, the financial condition
and operating history of the borrower and the related Mortgaged Property, tax
laws, rent control laws (with respect to certain residential properties),
Medicaid and Medicare reimbursement rates (with respect to hospitals and
nursing homes), prevailing general economic conditions and the availability of
credit for loans secured by multifamily or commercial, as the case may be, real
properties generally. Neither the Depositor nor any of its affiliates will be
required to refinance any Mortgage Loan.
If and to the extent described herein and in the related Prospectus
Supplement, in order to maximize recoveries on defaulted Mortgage Loans, the
Master Servicer or a Special Servicer will be permitted (within prescribed
limits) to extend and modify Mortgage Loans that are in default or as to which
a payment default is imminent. See "The Pooling and Servicing
Agreements--Realization upon Defaulted Mortgage Loans". While a Master Servicer
or a Special Servicer generally will be required to determine that any such
extension or modification is reasonably likely to produce a greater recovery
than liquidation, taking into account the time value of money, there can be no
assurance that any such extension or modification will in fact increase the
present value of receipts from or proceeds of the affected Mortgage Loans.
LEASES AND RENTS
Each Mortgage Loan included in any Trust Fund secured by Mortgaged
Property that is subject to leases typically will be secured by an assignment
of leases and rents pursuant to which the borrower assigns to the lender its
right, title and interest as landlord under the leases of the related Mortgaged
Property, and the income derived therefrom, as further security for the related
Mortgage Loan, while retaining a license to collect rents for so long as there
is no default. If the borrower defaults, the license terminates and the lender
is entitled to collect rents. Some state laws may require that the lender take
possession of the Mortgaged Property and obtain a judicial appointment of a
receiver before becoming
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entitled to collect the rents. In addition, if bankruptcy or similar
proceedings are commenced by or in respect of the borrower, the lender's
ability to collect the rents may be adversely affected. See "Certain Legal
Aspects of Mortgage Loans--Leases and Rents".
ENVIRONMENTAL CONSIDERATIONS
Under the laws of certain states, contamination of real property may give
rise to a lien on the property to assure the costs of cleanup. In several
states, such a lien has priority over an existing mortgage lien on such
property. In addition, under the laws of some states and under the federal
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as amended, a lender may be liable, as an "owner" or "operator", for costs of
addressing releases or threatened releases of hazardous substances at a
property, if agents or employees of the lender have become sufficiently
involved in the operations of the borrower, regardless of whether the
environmental damage or threat was caused by the borrower or a prior owner. A
lender also risks such liability on foreclosure of the mortgage.
DESCRIPTION OF THE TRUST FUNDS
GENERAL
The primary assets of each Trust Fund will consist of Mortgage Loans (see
"--Mortgage Loans" below), MBS (see "--MBS" below) or a combination of Mortgage
Loans and MBS. Each Trust Fund will be established by the Depositor. Each
Mortgage Asset will be selected by the Depositor for inclusion in a Trust Fund
from among those purchased, either directly or indirectly, from a prior holder
thereof (a "Mortgage Asset Seller"), which prior holder may or may not be the
originator of such Mortgage Loan or the issuer of such MBS and may be GMACCM or
another affiliate of the Depositor. The Mortgage Assets will not be guaranteed
or insured by the Depositor, GMACCM or any of their affiliates or, unless
otherwise provided in the related Prospectus Supplement, by any governmental
agency or instrumentality or by any other person. The discussion below under
the heading "--Mortgage Loans", unless otherwise noted, applies equally to
mortgage loans underlying any MBS included in a particular Trust Fund.
MORTGAGE LOANS
General. The Mortgage Loans will be evidenced by promissory notes (the
"Mortgage Notes") secured by mortgages, deeds of trust or similar security
instruments (the "Mortgages") that create first or junior liens on fee or
leasehold estates in properties (the "Mortgaged Properties") consisting of (i)
residential properties consisting of five or more rental or cooperatively-owned
dwelling units in high-rise, mid-rise or garden apartment buildings or other
residential structures ("Multifamily Properties") or (ii) office buildings,
retail stores and establishments, hotels or motels, nursing homes, hospitals or
other health care-related facilities, mobile home parks, warehouse facilities,
mini-warehouse facilities, self-storage facilities, industrial plants, parking
lots, mixed use or various other types of income-producing properties or
unimproved land ("Commercial Properties"). The Multifamily Properties may
include mixed commercial and residential structures and apartment buildings
owned by private cooperative housing corporations ("Cooperatives"). Unless
otherwise specified in the related Prospectus Supplement, each Mortgage will
create a first priority mortgage lien on a borrower's fee estate in a Mortgaged
Property. If a Mortgage creates a lien on a borrower's leasehold estate in a
property, then, unless otherwise specified in the related Prospectus
Supplement, the term of any such leasehold will exceed the term of the Mortgage
Note by at least ten years. Unless otherwise specified in the related
Prospectus Supplement, each Mortgage Loan will have been originated by a person
(the "Originator") other than the Depositor; however, the Originator may be
GMACCM or, alternatively, may be or may have been another affiliate of the
Depositor.
If so provided in the related Prospectus Supplement, Mortgage Assets for a
series of Certificates may include Mortgage Loans secured by junior liens, and
the loans secured by the related senior liens ("Senior Liens") may not be
included in the Mortgage Pool. The primary risk to holders of Mortgage Loans
secured by junior liens is the possibility that adequate funds will not be
received in connection with a foreclosure of the related Senior Liens to
satisfy fully both the Senior Liens and the Mortgage Loan. In
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the event that a holder of a Senior Lien forecloses on a Mortgaged Property,
the proceeds of the foreclosure or similar sale will be applied first to the
payment of court costs and fees in connection with the foreclosure, second to
real estate taxes, third in satisfaction of all principal, interest, prepayment
or acceleration penalties, if any, and any other sums due and owing to the
holder of the Senior Liens. The claims of the holders of the Senior Liens will
be satisfied in full out of proceeds of the liquidation of the related Mortgage
Property, if such proceeds are sufficient, before the Trust Fund as holder of
the junior lien receives any payments in respect of the Mortgage Loan. If the
Master Servicer were to foreclose on any Mortgage Loan, it would do so subject
to any related Senior Liens. In order for the debt related to such Mortgage
Loan to be paid in full at such sale, a bidder at the foreclosure sale of such
Mortgage Loan would have to bid an amount sufficient to pay off all sums due
under the Mortgage Loan and any Senior Liens or purchase the Mortgaged Property
subject to such Senior Liens. In the event that such proceeds from a
foreclosure or similar sale of the related Mortgaged Property are insufficient
to satisfy all Senior Liens and the Mortgage Loan in the aggregate, the Trust
Fund, as the holder of the junior lien, and, accordingly, holders of one or
more classes of the Certificates of the related series bear (i) the risk of
delay in distributions while a deficiency judgment against the borrower is
obtained and (ii) the risk of loss if the deficiency judgment is not realized
upon. Moreover, deficiency judgments may not be available in certain
jurisdictions or the Mortgage Loan may be nonrecourse.
If so specified in the related Prospectus Supplement, Mortgage Assets for
a series of Certificates may include Mortgage Loans made on the security of
real estate projects under construction. In that case, the related Prospectus
Supplement will describe the procedures and timing for making disbursements
from construction reserve funds as portions of the related real estate project
are completed. In addition, the Mortgage Assets for a particular series of
Certificates may include Mortgage Loans that are delinquent or non-performing
as of the date such Certificates are issued. In that case, the related
Prospectus Supplement will set forth, as to each such Mortgage Loan, available
information as to the period of such delinquency or non-performance, any
forbearance arrangement then in effect, the condition of the related Mortgaged
Property and the ability of the Mortgaged Property to generate income to
service the mortgage debt.
Default and Loss Considerations with Respect to the Mortgage
Loans. Mortgage loans secured by liens on income-producing properties are
substantially different from loans made on the security of owner-occupied
single-family homes. The repayment of a loan secured by a lien on an
income-producing property is typically dependent upon the successful operation
of such property (that is, its ability to generate income). Moreover, some or
all of the Mortgage Loans included in a particular Trust Fund may be
non-recourse loans, which means that, absent special facts, recourse in the
case of default will be limited to the Mortgaged Property and such other
assets, if any, that were pledged to secure repayment of the Mortgage Loan.
Lenders typically look to the Debt Service Coverage Ratio of a loan
secured by income-producing property as an important factor in evaluating the
likelihood of default on such a loan. Unless otherwise defined in the related
Prospectus Supplement, the "Debt Service Coverage Ratio," "Underwritten Debt
Service Coverage Ratio" or "Underwritten DSCR" means, with respect to any
Mortgage Loan, or with respect to a Mortgage Loan evidenced by one Mortgage
Note, but secured by multiple Mortgaged Properties, (a) the Underwritten Cash
flow for the Mortgaged Property, divided by (b) the Annual Debt Service for
such Mortgage Loan. "Underwritten Cash Flow" with respect to any Mortgaged
Property, means an estimate of cash flow available for debt service in a
typical year of stable, normal operations. In general, it is the estimated
revenue derived from the use and operation of such Mortgaged Property less the
sum of (a) estimated operating expenses (such as utilities, administrative
expenses, repairs and maintenance, management and franchise fees and
advertising), (b) fixed expenses (such as insurance, real estate taxes and, if
applicable, ground lease payments) and (c) capital expenditures and reserves
for capital expenditures, including tenant improvement costs and leasing
commissions. Underwritten Cash Flow generally does not reflect interest expense
and non-cash items such as depreciation and amortization. "Annual Debt Service"
means for any Mortgage Loan 12 times the monthly payment in effect as of the
Cut-off Date or, for any Mortgage Loans that pay interest only for a period of
time, 12 times the monthly payment in effect at the end of such period. The
Underwritten Cash Flow of a Mortgaged
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Property will generally fluctuate over time and may or may not be sufficient to
cover debt service on the related Mortgage Loan at any given time. As the
primary source of the operating revenues of a non-owner occupied,
income-producing property, rental income (and, with respect to a Mortgage Loan
secured by a Cooperative apartment building, maintenance payments from
tenant-stockholders of a Cooperative) may be affected by the condition of the
applicable real estate market and/or area economy. In addition, properties
typically leased, occupied or used on a short-term basis, such as certain
health care-related facilities, hotels and motels, and mini-warehouse and
self-storage facilities, tend to be affected more rapidly by changes in market
or business conditions than do properties typically leased for longer periods,
such as warehouses, retail stores, office buildings and industrial plants.
Commercial Properties may be owner-occupied or leased to a small number of
tenants. Thus, the Underwritten Cash Flow of such a Mortgaged Property may
depend substantially on the financial condition of the borrower or a tenant,
and Mortgage Loans secured by liens on such properties may pose a greater
likelihood of default and loss than loans secured by liens on Multifamily
Properties or on multi-tenant Commercial Properties.
Increases in operating expenses due to the general economic climate or
economic conditions in a locality or industry segment, such as increases in
interest rates, real estate tax rates, energy costs, labor costs and other
operating expenses, and/or to changes in governmental rules, regulations and
fiscal policies, may also affect the likelihood of default on a Mortgage Loan.
As may be further described in the related Prospectus Supplement, in some cases
leases of Mortgaged Properties may provide that the lessee, rather than the
borrower/landlord, is responsible for payment of operating expenses ("Net
Leases"). However, the existence of such "net of expense" provisions will
result in stable Underwritten Cash Flow to the borrower/landlord only to the
extent that the lessee is able to absorb operating expense increases while
continuing to make rent payments.
Lenders also look to the Loan-to-Value Ratio of a mortgage loan as a
factor in evaluating the likelihood of loss if a property must be liquidated
following a default. Unless otherwise defined in the related Prospectus
Supplement, the "Loan-to-Value Ratio" of a Mortgage Loan at any given time is
the ratio (expressed as a percentage) of (i) the then outstanding principal
balance of the Mortgage Loan and any other loans senior thereto that are
secured by the related Mortgaged Property to (ii) the Value of the related
Mortgaged Property. Unless otherwise specified in the related Prospectus
Supplement, the "Value" of a Mortgaged Property will be its fair market value
determined in an appraisal obtained by the Originator at the origination of
such loan. The lower the Loan-to-Value Ratio, the greater the percentage of the
borrower's equity in a Mortgaged Property, and thus (a) the greater the
incentive of the borrower to perform under the terms of the related Mortgage
Loan (in order to protect such equity) and (b) the greater the cushion provided
to the lender against loss on liquidation following a default.
Loan-to-Value Ratios will not necessarily constitute an accurate measure
of the likelihood of liquidation loss in a pool of Mortgage Loans. For example,
the value of a Mortgaged Property as of the date of initial issuance of the
related series of Certificates may be less than the Value determined at loan
origination, and will likely continue to fluctuate from time to time based upon
certain factors including changes in economic conditions and the real estate
market. Moreover, even when current, an appraisal is not necessarily a reliable
estimate of value. Appraised values of income-producing properties are
generally based on the market comparison method (recent resale value of
comparable properties at the date of the appraisal), the cost replacement
method (the cost of replacing the property at such date), the income
capitalization method (a projection of value based upon the property's
projected net cash flow), or upon a selection from or interpolation of the
values derived from such methods. Each of these appraisal methods can present
analytical difficulties. It is often difficult to find truly comparable
properties that have recently been sold; the replacement cost of a property may
have little to do with its current market value; and income capitalization is
inherently based on inexact projections of income and expense and the selection
of an appropriate capitalization rate and discount rate. Where more than one of
these appraisal methods are used and provide significantly different results,
an accurate determination of value and, correspondingly, a reliable analysis of
the likelihood of default and loss, is even more difficult.
Although there may be multiple methods for determining the value of a
Mortgaged Property, value will in all cases be affected by property
performance. As a result, if a Mortgage Loan defaults because the income
generated by the related Mortgaged Property is insufficient to cover operating
costs and expenses and pay debt service, then the value of the Mortgaged
Property will reflect such and a liquidation loss may occur.
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While the Depositor believes that the foregoing considerations are
important factors that generally distinguish loans secured by liens on
income-producing real estate from single-family mortgage loans, there can be no
assurance that all of such factors will in fact have been prudently considered
by the Originators of the Mortgage Loans, or that, for a particular Mortgage
Loan, they are complete or relevant. See "Risk Factors--Investment in
Commercial and Multifamily Mortgage Loans" and "--Balloon Payments; Borrower
Default".
Payment Provisions of the Mortgage Loans. Unless otherwise specified in
the related Prospectus Supplement, all of the Mortgage Loans will (i) have had
original terms to maturity of not more than 40 years and (ii) provide for
scheduled payments of principal, interest or both, to be made on specified
dates ("Due Dates") that occur monthly, quarterly, semi-annually or annually. A
Mortgage Loan (i) may provide for no accrual of interest or for accrual of
interest thereon at a Mortgage Rate that is fixed over its term or that adjusts
from time to time, or that may be converted at the borrower's election from an
adjustable to a fixed Mortgage Rate, or from a fixed to an adjustable Mortgage
Rate, (ii) may provide for level payments to maturity or for payments that
adjust from time to time to accommodate changes in the Mortgage Rate or to
reflect the occurrence of certain events, and may permit negative amortization,
(iii) may be fully amortizing or may be partially amortizing or non-amortizing,
with a balloon payment due on its stated maturity date, and (iv) may prohibit
over its term or for a certain period prepayments (the period of such
prohibition, a "Lock-Out Period" and its date of expiration, a "Lock-Out Date")
and/or require payment of a premium or a yield maintenance penalty (a
"Prepayment Premium") in connection with certain prepayments, in each case as
described in the related Prospectus Supplement. A Mortgage Loan may also
contain a provision that entitles the lender to a share of appreciation of the
related Mortgaged Property, or profits realized from the operation or
disposition of such Mortgaged Property or the benefit, if any, resulting from
the refinancing of the Mortgage Loan (any such provision, an "Equity
Participation"), as described in the related Prospectus Supplement.
Mortgage Loan Information in Prospectus Supplements. Each Prospectus
Supplement will contain certain information pertaining to the Mortgage Loans in
the related Trust Fund, which, to the extent then applicable and specifically
known to the Depositor, will generally include the following: (i) the aggregate
outstanding principal balance and the largest, smallest and average outstanding
principal balance of the Mortgage Loans, (ii) the type or types of property
that provide security for repayment of the Mortgage Loans, (iii) the earliest
and latest origination date and maturity date of the Mortgage Loans, (iv) the
original and remaining terms to maturity of the Mortgage Loans, or the
respective ranges thereof, and the weighted average original and remaining
terms to maturity of the Mortgage Loans, (v) the Loan-to-Value Ratios of the
Mortgage Loans (either at origination or as of a more recent date), or the
range thereof, and the weighted average of such Loan-to-Value Ratios, (vi) the
Mortgage Rates borne by the Mortgage Loans, or range thereof, and the weighted
average Mortgage Rate borne by the Mortgage Loans, (vii) with respect to
Mortgage Loans with adjustable Mortgage Rates ("ARM Loans"), the index or
indices upon which such adjustments are based, the adjustment dates, the range
of gross margins and the weighted average gross margin, and any limits on
Mortgage Rate adjustments at the time of any adjustment and over the life of
the ARM Loan, (viii) information regarding the payment characteristics of the
Mortgage Loans, including, without limitation, balloon payment and other
amortization provisions, Lock-out Periods and Prepayment Premiums, (ix) the
Debt Service Coverage Ratios of the Mortgage Loans (either at origination or as
of a more recent date), or the range thereof, and the weighted average of such
Debt Service Coverage Ratios, and (x) the geographic distribution of the
Mortgaged Properties on a state-by-state basis. In appropriate cases, the
related Prospectus Supplement will also contain certain information available
to the Depositor that pertains to the provisions of leases and the nature of
tenants of the Mortgaged Properties. If the Depositor is unable to provide the
specific information described above at the time Offered Certificates of a
series are initially offered, more general information of the nature described
above will be provided in the related Prospectus Supplement, and specific
information will be set forth in a report which will be available to purchasers
of those Certificates at or before the initial issuance thereof and will be
filed as part of a Current Report on Form 8-K with the Commission within
fifteen days following such issuance.
MBS
MBS may include (i) private-label (that is, not guaranteed or insured by
the United States or any agency or instrumentality thereof) mortgage
participations, mortgage pass-through certificates or other
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mortgage-backed securities or (ii) certificates insured or guaranteed by the
Federal Home Loan Mortgage Corporation ("FHLMC"), the Federal National Mortgage
Association ("FNMA"), the Governmental National Mortgage Association or the
Federal Agricultural Mortgage Corporation ("FAMC"), provided that, unless
otherwise specified in the related Prospectus Supplement, each MBS will
evidence an interest in, or will be secured by a pledge of, mortgage loans that
conform to the descriptions of the Mortgage Loans contained herein.
Any MBS will have been issued pursuant to a participation and servicing
agreement, a pooling and servicing agreement, an indenture or similar agreement
(an "MBS Agreement"). The issuer of the MBS (the "MBS Issuer") and/or the
servicer of the underlying mortgage loans (the "MBS Servicer") will have
entered into the MBS Agreement, generally with a trustee (the "MBS Trustee")
or, in the alternative, with the original purchaser or purchasers of the MBS.
The MBS may have been issued in one or more classes with characteristics
similar to the classes of Certificates described herein. Distributions in
respect of the MBS will be made by the MBS Issuer, the MBS Servicer or the MBS
Trustee on the dates specified in the related Prospectus Supplement. The MBS
Issuer or the MBS Servicer or another person specified in the related
Prospectus Supplement may have the right or obligation to repurchase or
substitute assets underlying the MBS after a certain date or under other
circumstances specified in the related Prospectus Supplement.
Reserve funds, subordination or other credit support similar to that
described for the Certificates under "Description of Credit Support" may have
been provided with respect to the MBS. The type, characteristics and amount of
such credit support, if any, will be a function of the characteristics of the
underlying mortgage loans and other factors and generally will have been
established on the basis of the requirements of any Rating Agency that may have
assigned a rating to the MBS, or by the initial purchasers of the MBS.
The Prospectus Supplement for a series of Certificates that evidence
interests in MBS will specify, to the extent available, (i) the aggregate
approximate initial and outstanding principal amount and type of the MBS to be
included in the Trust Fund, (ii) the original and remaining term to stated
maturity of the MBS, if applicable, (iii) the pass-through or bond rate of the
MBS or the formula for determining such rates, (iv) the payment characteristics
of the MBS, (v) the MBS Issuer, MBS Servicer and MBS Trustee, as applicable,
(vi) a description of the credit support, if any, (vii) the circumstances under
which the related underlying mortgage loans, or the MBS themselves, may be
purchased prior to their maturity, (viii) the terms on which mortgage loans may
be substituted for those originally underlying the MBS, (ix) the type of
mortgage loans underlying the MBS and, to the extent available to the Depositor
and appropriate under the circumstances, such other information in respect of
the underlying mortgage loans described under "--Mortgage Loans--Mortgage Loan
Information in Prospectus Supplements", and (x) the characteristics of any cash
flow agreements that relate to the MBS.
CERTIFICATE ACCOUNTS
Each Trust Fund will include one or more accounts (collectively, the
"Certificate Account") established and maintained on behalf of the
Certificateholders into which all payments and collections received or advanced
with respect to the Mortgage Assets and other assets in the Trust Fund will be
deposited to the extent described herein and in the related Prospectus
Supplement. See "The Pooling and Servicing Agreements--Certificate Account".
CREDIT SUPPORT
If so provided in the Prospectus Supplement for a series of Certificates,
partial or full protection against certain defaults and losses on the Mortgage
Assets in the related Trust Fund may be provided to one or more classes of
Certificates of such series in the form of subordination of one or more other
classes of Certificates of such series or by one or more other types of credit
support, such as a letter of credit, insurance policy, guarantee or reserve
fund, among others, or a combination thereof. The amount and
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types of Credit Support, the identification of the entity providing it (if
applicable) and related information with respect to each type of Credit
Support, if any, will be set forth in the Prospectus Supplement for a series of
Certificates. See "Risk Factors--Credit Support Limitations" and "Description
of Credit Support".
CASH FLOW AGREEMENTS
If so provided in the Prospectus Supplement for a series of Certificates,
the related Trust Fund may include guaranteed investment contracts pursuant to
which moneys held in the funds and accounts established for such series will be
invested at a specified rate. The Trust Fund may also include certain other
agreements, such as interest rate exchange agreements, interest rate cap or
floor agreements, or other agreements designed to reduce the effects of
interest rate fluctuations on the Mortgage Assets on one or more classes of
Certificates. The principal terms of any such Cash Flow Agreement, including,
without limitation, provisions relating to the timing, manner and amount of
payments thereunder and provisions relating to the termination thereof, will be
described in the related Prospectus Supplement. The related Prospectus
Supplement will also identify the obligor under the Cash Flow Agreement.
YIELD AND MATURITY CONSIDERATIONS
GENERAL
The yield on any Offered Certificate will depend on the price paid by the
Certificateholder, the Pass-Through Rate of the Certificate and the amount and
timing of distributions on the Certificate. See "Risk Factors--Yield and
Prepayment Considerations". The following discussion contemplates a Trust Fund
that consists solely of Mortgage Loans. While the characteristics and behavior
of mortgage loans underlying an MBS can generally be expected to have the same
effect on the yield to maturity and/or weighted average life of a class of
Certificates as will the characteristics and behavior of comparable Mortgage
Loans, the effect may differ due to the payment characteristics of the MBS. If
a Trust Fund includes MBS, the related Prospectus Supplement will discuss the
effect, if any, that the payment characteristics of the MBS may have on the
yield to maturity and weighted average lives of the Offered Certificates of the
related series.
PASS-THROUGH RATE
The Certificates of any class within a series may have a fixed, variable
or adjustable Pass-Through Rate, which may or may not be based upon the
interest rates borne by the Mortgage Loans in the related Trust Fund. The
Prospectus Supplement with respect to any series of Certificates will specify
the Pass-Through Rate for each class of Offered Certificates of such series or,
in the case of a class of Offered Certificates with a variable or adjustable
Pass-Through Rate, the method of determining the Pass-Through Rate; the effect,
if any, of the prepayment of any Mortgage Loan on the Pass-Through Rate of one
or more classes of Offered Certificates; and whether the distributions of
interest on the Offered Certificates of any class will be dependent, in whole
or in part, on the performance of any obligor under a Cash Flow Agreement.
PAYMENT DELAYS
With respect to any series of Certificates, a period of time will elapse
between the date upon which payments on the Mortgage Loans in the related Trust
Fund are due and the Distribution Date on which such payments are passed
through to Certificateholders. That delay will effectively reduce the yield
that would otherwise be produced if payments on such Mortgage Loans were
distributed to Certificateholders on the date they were due.
CERTAIN SHORTFALLS IN COLLECTIONS OF INTEREST
When a principal prepayment in full or in part is made on a Mortgage Loan,
the borrower is generally charged interest on the amount of such prepayment
only through the date of such prepayment, instead
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of through the Due Date for the next succeeding scheduled payment. However,
interest accrued on any series of Certificates and distributable thereon on any
Distribution Date will generally correspond to interest accrued on the Mortgage
Loans to their respective Due Dates during the related Due Period. Unless
otherwise specified in the Prospectus Supplement for a series of Certificates,
a "Due Period" will be a specified time period (generally running from the
second day of one month to the first day of the next month, inclusive) and all
scheduled payments on the Mortgage Loans in the related Trust Fund that are due
during a given Due Period will, to the extent received by a specified date (the
"Determination Date") or otherwise advanced by the related Master Servicer or
other specified person, be distributed to the holders of the Certificates of
such series on the next succeeding Distribution Date. Consequently, if a
prepayment on any Mortgage Loan is distributable to Certificateholders on a
particular Distribution Date, but such prepayment is not accompanied by
interest thereon to the Due Date for such Mortgage Loan in the related Due
Period, then the interest charged to the borrower (net of servicing and
administrative fees) may be less (such shortfall, a "Prepayment Interest
Shortfall") than the corresponding amount of interest accrued and otherwise
payable on the Certificates of the related series. If and to the extent that
any such shortfall is allocated to a class of Offered Certificates, the yield
thereon will be adversely affected. The Prospectus Supplement for each series
of Certificates will describe the manner in which any such shortfalls will be
allocated among the classes of such Certificates. The related Prospectus
Supplement will also describe any amounts available to offset such shortfalls.
YIELD AND PREPAYMENT CONSIDERATIONS
A Certificate's yield to maturity will be affected by the rate of
principal payments on the Mortgage Loans in the related Trust Fund and the
allocation thereof to reduce the principal balance (or notional amount, if
applicable) of such Certificate. The rate of principal payments on the Mortgage
Loans in any Trust Fund will in turn be affected by the amortization schedules
thereof (which, in the case of ARM Loans, may change periodically to
accommodate adjustments to the Mortgage Rates thereon), the dates on which any
balloon payments are due, and the rate of principal prepayments thereon
(including for this purpose, voluntary prepayments by borrowers and also
prepayments resulting from liquidations of Mortgage Loans due to defaults,
casualties or condemnations affecting the Mortgaged Properties, or purchases of
Mortgage Loans out of the related Trust Fund). Because the rate of principal
prepayments on the Mortgage Loans in any Trust Fund will depend on future
events and a variety of factors (as described below), no assurance can be given
as to such rate.
The extent to which the yield to maturity of a class of Offered
Certificates of any series may vary from the anticipated yield will depend upon
the degree to which they are purchased at a discount or premium and when, and
to what degree, payments of principal on the Mortgage Loans in the related
Trust Fund are in turn distributed on such Certificates (or, in the case of a
class of Stripped Interest Certificates, result in the reduction of the
Notional Amount thereof). An investor should consider, in the case of any
Offered Certificate purchased at a discount, the risk that a slower than
anticipated rate of principal payments on the Mortgage Loans in the related
Trust Fund could result in an actual yield to such investor that is lower than
the anticipated yield and, in the case of any Offered Certificate purchased at
a premium, the risk that a faster than anticipated rate of principal payments
on such Mortgage Loans could result in an actual yield to such investor that is
lower than the anticipated yield. In addition, if an investor purchases an
Offered Certificate at a discount (or premium), and principal payments are made
in reduction of the principal balance or notional amount of such investor's
Offered Certificates at a rate slower (or faster) than the rate anticipated by
the investor during any particular period, the consequent adverse effects on
such investor's yield would not be fully offset by a subsequent like increase
(or decrease) in the rate of principal payments.
In general, the Notional Amount of a class of Stripped Interest
Certificates will either (i) be based on the principal balances of some or all
of the Mortgage Assets in the related Trust Fund or (ii) equal the Certificate
Balances of one or more of the other classes of Certificates of the same
series. Accordingly, the yield on such Stripped Interest Certificates will be
inversely related to the rate at which payments and other collections of
principal are received on such Mortgage Assets or distributions are made in
reduction of the Certificate Balances of such classes of Certificates, as the
case may be.
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Consistent with the foregoing, if a class of Certificates of any series
consists of Stripped Interest Certificates or Stripped Principal Certificates,
a lower than anticipated rate of principal prepayments on the Mortgage Loans in
the related Trust Fund will negatively affect the yield to investors in
Stripped Principal Certificates, and a higher than anticipated rate of
principal prepayments on such Mortgage Loans will negatively affect the yield
to investors in Stripped Interest Certificates. If the Offered Certificates of
a series include any such Certificates, the related Prospectus Supplement will
include a table showing the effect of various constant assumed levels of
prepayment on yields on such Certificates. Such tables will be intended to
illustrate the sensitivity of yields to various constant assumed prepayment
rates and will not be intended to predict, or to provide information that will
enable investors to predict, yields or prepayment rates.
The Depositor is not aware of any relevant publicly available or
authoritative statistics with respect to the historical prepayment experience
of a group of multifamily or commercial mortgage loans. However, the extent of
prepayments of principal of the Mortgage Loans in any Trust Fund may be
affected by a number of factors, including, without limitation, the
availability of mortgage credit, the relative economic vitality of the area in
which the Mortgaged Properties are located, the quality of management of the
Mortgaged Properties, the servicing of the Mortgage Loans, possible changes in
tax laws and other opportunities for investment. In addition, the rate of
principal payments on the Mortgage Loans in any Trust Fund may be affected by
the existence of Lock-out Periods and requirements that principal prepayments
be accompanied by Prepayment Premiums, and by the extent to which such
provisions may be practicably enforced. To the extent enforceable, such
provisions could constitute either an absolute prohibition (in the case of a
Lock-out Period) or a disincentive (in the case of a Prepayment Premium) to a
borrower's voluntarily prepaying its Mortgage Loan.
The rate of prepayment on a pool of mortgage loans is likely to be
affected by prevailing market interest rates for mortgage loans of a comparable
type, term and risk level. When the prevailing market interest rate is below a
mortgage coupon, a borrower may have an increased incentive to refinance its
mortgage loan. Even in the case of ARM Loans, as prevailing market interest
rates decline, and without regard to whether the Mortgage Rates on such ARM
Loans decline in a manner consistent therewith, the related borrowers may have
an increased incentive to refinance for purposes of either (i) converting to a
fixed rate loan and thereby "locking in" such rate or (ii) taking advantage of
a different index, margin or rate cap or floor on another adjustable rate
mortgage loan.
Depending on prevailing market interest rates, the outlook for market
interest rates and economic conditions generally, some borrowers may sell
Mortgaged Properties in order to realize their equity therein, to meet cash
flow needs or to make other investments. In addition, some borrowers may be
motivated by federal and state tax laws (which are subject to change) to sell
Mortgaged Properties prior to the exhaustion of tax depreciation benefits. The
Depositor makes no representation as to the particular factors that will affect
the prepayment of the Mortgage Loans in any Trust Fund, as to the relative
importance of such factors, as to the percentage of the principal balance of
such Mortgage Loans that will be paid as of any date or as to the overall rate
of prepayment on such Mortgage Loans.
WEIGHTED AVERAGE LIFE AND MATURITY
The rate at which principal payments are received on the Mortgage Loans in
any Trust Fund will affect the ultimate maturity and the weighted average life
of one or more classes of the Certificates of such series. Unless otherwise
specified in the related Prospectus Supplement, weighted average life refers to
the average amount of time that will elapse from the date of issuance of an
instrument until each dollar allocable as principal of such instrument is
repaid to the investor.
The weighted average life and maturity of a class of Certificates of any
series will be influenced by the rate at which principal on the related
Mortgage Loans, whether in the form of scheduled amortization or prepayments
(for this purpose, the term "prepayment" includes voluntary prepayments,
liquidations due to default and purchases of Mortgage Loans out of the related
Trust Fund), is paid to such class. Prepayment rates on loans are commonly
measured relative to a prepayment standard or model, such as the Constant
Prepayment Rate ("CPR") prepayment model or the Standard Prepayment Assumption
("SPA") prepayment model. CPR represents an assumed constant rate of prepayment
each month
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(expressed as an annual percentage) relative to the then outstanding principal
balance of a pool of loans for the life of such loans. SPA represents an
assumed variable rate of prepayment each month (expressed as an annual
percentage) relative to the then outstanding principal balance of a pool of
loans, with different prepayment assumptions often expressed as percentages of
SPA. For example, a prepayment assumption of 100% of SPA assumes prepayment
rates of 0.2% per annum of the then outstanding principal balance of such loans
in the first month of the life of the loans and an additional 0.2% per annum in
each month thereafter until the thirtieth month. Beginning in the thirtieth
month, and in each month thereafter during the life of the loans, 100% of SPA
assumes a constant prepayment rate of 6% per annum each month.
Neither CPR nor SPA nor any other prepayment model or assumption purports
to be a historical description of prepayment experience or a prediction of the
anticipated rate of prepayment of any particular pool of loans. Moreover, the
CPR and SPA models were developed based upon historical prepayment experience
for single-family loans. Thus, it is unlikely that the prepayment experience of
the Mortgage Loans included in any Trust Fund will conform to any particular
level of CPR or SPA.
The Prospectus Supplement with respect to each series of Certificates will
contain tables, if applicable, setting forth the projected weighted average
life of each class of Offered Certificates of such series and the percentage of
the initial Certificate Balance of each such class that would be outstanding on
specified Distribution Dates based on the assumptions stated in such Prospectus
Supplement, including assumptions that prepayments on the related Mortgage
Loans are made at rates corresponding to various percentages of CPR or SPA, or
at such other rates specified in such Prospectus Supplement. Such tables and
assumptions will illustrate the sensitivity of the weighted average lives of
the Certificates to various assumed prepayment rates and will not be intended
to predict, or to provide information that will enable investors to predict,
the actual weighted average lives of the Certificates.
OTHER FACTORS AFFECTING YIELD, WEIGHTED AVERAGE LIFE AND MATURITY
Balloon Payments; Extensions of Maturity. Some or all of the Mortgage
Loans included in a particular Trust Fund may require that balloon payments be
made at maturity. Because the ability of a borrower to make a balloon payment
typically will depend upon its ability either to refinance the loan or to sell
the related Mortgaged Property, there is a possibility that Mortgage Loans that
require balloon payments may default at maturity, or that the maturity of such
a Mortgage Loan may be extended in connection with a workout. In the case of
defaults, recovery of proceeds may be delayed by, among other things,
bankruptcy of the borrower or adverse conditions in the market where the
property is located. In order to minimize losses on defaulted Mortgage Loans,
the Master Servicer or a Special Servicer, to the extent and under the
circumstances set forth herein and in the related Prospectus Supplement, may be
authorized to modify Mortgage Loans that are in default or as to which a
payment default is imminent. Any defaulted balloon payment or modification that
extends the maturity of a Mortgage Loan may delay distributions of principal on
a class of Offered Certificates and thereby extend the weighted average life of
such Certificates and, if such Certificates were purchased at a discount,
reduce the yield thereon.
Negative Amortization. The weighted average life of a class of
Certificates can be affected by Mortgage Loans that permit negative
amortization to occur. A Mortgage Loan that provides for the payment of
interest calculated at a rate lower than the rate at which interest accrues
thereon would, in the case of an ARM Loan, be expected during a period of
increasing interest rates to amortize at a slower rate (and perhaps not at all)
than if interest rates were declining or were remaining constant. Such slower
rate of Mortgage Loan amortization would correspondingly be reflected in a
slower rate of amortization for one or more classes of Certificates of the
related series. In addition, negative amortization on one or more Mortgage
Loans in any Trust Fund may result in negative amortization on the Certificates
of the related series. The related Prospectus Supplement will describe, if
applicable, the manner in which negative amortization in respect of the
Mortgage Loans in any Trust Fund is allocated among the respective classes of
Certificates of the related series. The portion of any Mortgage Loan negative
amortization allocated to a class of Certificates may result in a deferral of
some or all of the interest payable thereon, which deferred interest may be
added to the Certificate Balance thereof. Accordingly, the weighted average
lives of Mortgage Loans that permit negative amortization (and that of the
classes of Certificates to which any
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such negative amortization would be allocated or that would bear the effects of
a slower rate of amortization on such Mortgage Loans) may increase as a result
of such feature.
Negative amortization also may occur in respect of an ARM Loan that (i)
limits the amount by which its scheduled payment may adjust in response to a
change in its Mortgage Rate, (ii) provides that its scheduled payment will
adjust less frequently than its Mortgage Rate or (iii) provides for constant
scheduled payments notwithstanding adjustments to its Mortgage Rate.
Accordingly, during a period of declining interest rates, the scheduled payment
on such a Mortgage Loan may exceed the amount necessary to amortize the loan
fully over its remaining amortization schedule and pay interest at the then
applicable Mortgage Rate, thereby resulting in the accelerated amortization of
such Mortgage Loan. Any such acceleration in amortization of its principal
balance will shorten the weighted average life of such Mortgage Loan and,
correspondingly, the weighted average lives of those classes of Certificates
entitled to a portion of the principal payments on such Mortgage Loan.
The extent to which the yield on any Offered Certificate will be affected
by the inclusion in the related Trust Fund of Mortgage Loans that permit
negative amortization, will depend upon (i) whether such Offered Certificate
was purchased at a premium or a discount and (ii) the extent to which the
payment characteristics of such Mortgage Loans delay or accelerate the
distributions of principal on such Certificate (or, in the case of a Stripped
Interest Certificate, delay or accelerate the reduction of the notional amount
thereof). See "--Yield and Prepayment Considerations" above.
Foreclosures and Payment Plans. The number of foreclosures and the
principal amount of the Mortgage Loans that are foreclosed in relation to the
number and principal amount of Mortgage Loans that are repaid in accordance
with their terms will affect the weighted average lives of those Mortgage Loans
and, accordingly, the weighted average lives of and yields on the Certificates
of the related series. Servicing decisions made with respect to the Mortgage
Loans, including the use of payment plans prior to a demand for acceleration
and the restructuring of Mortgage Loans in bankruptcy proceedings or otherwise,
may also have an effect upon the payment patterns of particular Mortgage Loans
and thus the weighted average lives of and yields on the Certificates of the
related series.
Losses and Shortfalls on the Mortgage Assets. The yield to holders of the
Offered Certificates of any series will directly depend on the extent to which
such holders are required to bear the effects of any losses or shortfalls in
collections arising out of defaults on the Mortgage Loans in the related Trust
Fund and the timing of such losses and shortfalls. In general, the earlier that
any such loss or shortfall occurs, the greater will be the negative effect on
yield for any class of Certificates that is required to bear the effects
thereof.
The amount of any losses or shortfalls in collections on the Mortgage
Assets in any Trust Fund (to the extent not covered or offset by draws on any
reserve fund or under any instrument of Credit Support) will be allocated among
the respective classes of Certificates of the related series in the priority
and manner, and subject to the limitations, specified in the related Prospectus
Supplement. As described in the related Prospectus Supplement, such allocations
may be effected by a reduction in the entitlements to interest and/or
Certificate Balances of one or more such classes of Certificates, and/or by
establishing a priority of payments among such classes of Certificates.
The yield to maturity on a class of Subordinate Certificates may be
extremely sensitive to losses and shortfalls in collections on the Mortgage
Loans in the related Trust Fund.
Additional Certificate Amortization. In addition to entitling the holders
thereof to a specified portion (which may during specified periods range from
none to all) of the principal payments received on the Mortgage Assets in the
related Trust Fund, one or more classes of Certificates of any series,
including one or more classes of Offered Certificates of such series, may
provide for distributions of principal thereof from (i) amounts attributable to
interest accrued but not currently distributable on one or more classes of
Accrual Certificates, (ii) Excess Funds or (iii) any other amounts described in
the related Prospectus Supplement. Unless otherwise specified in the related
Prospectus Supplement, "Excess Funds" will, in general, represent that portion
of the amounts distributable in respect of the Certificates of any series on
any Distribution Date that represent (i) interest received or advanced on the
Mortgage
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Assets in the related Trust Fund that is in excess of the interest currently
accrued on the Certificates of such series, or (ii) Prepayment Premiums,
payments from Equity Participations or any other amounts received on the
Mortgage Assets in the related Trust Fund that do not constitute interest
thereon or principal thereof.
The amortization of any class of Certificates out of the sources described
in the preceding paragraph would shorten the weighted average life of such
Certificates and, if such Certificates were purchased at a premium, reduce the
yield thereon. The related Prospectus Supplement will discuss the relevant
factors to be considered in determining whether distributions of principal of
any class of Certificates out of such sources is likely to have any material
effect on the rate at which such Certificates are amortized and the consequent
yield with respect thereto.
Optional Early Termination. Unless otherwise provided in the related
Prospectus Supplement, the Master Servicer, the Depositor or, if specified in
the related Prospectus Supplement, the holder of the residual interest in a
REMIC may at its option either (i) effect early retirement of a series of
Certificates through the purchase of the assets in the related Trust Fund or
(ii) purchase, in whole but not in part, the Certificates specified in the
related Prospectus Supplement; in each case under the circumstances and in the
manner set forth herein under "Description of the Certificates-Termination;
Retirement of Certificates" and in the related Prospectus Supplement. In the
absence of other factors, any such early retirement of a class of Offered
Certificates would shorten the weighted average life thereof and, if such
Certificates were purchased at premium, reduce the yield thereon.
THE DEPOSITOR
GMAC Commercial Mortgage Securities, Inc. is an indirect wholly-owned
subsidiary of GMACCM which is a wholly-owned subsidiary of GMAC Mortgage Group,
Inc., a Michigan Corporation. The Depositor was incorporated in the State of
Delaware on June 22, 1995. The Depositor was organized for the purpose of
serving as a private secondary mortgage market conduit. The Depositor maintains
its principal office at 650 Dresher Road, Horsham, Pennsylvania 19044. Its
telephone number is (215) 328-3164. The Depositor does not have, nor is it
expected in the future to have, any significant assets.
GMAC COMMERCIAL MORTGAGE CORPORATION
Unless otherwise specified in the related Prospectus Supplement, GMAC
Commercial Mortgage Corporation, an affiliate of the Company and a corporation
duly organized and existing under the laws of the State of California, will act
as the Master Servicer or Manager for a series of Certificates.
GMACCM buys mortgage loans primarily through its branch network and also
from mortgage loan originators or sellers nationwide and services mortgage
loans for its own account and for others. GMACCM's principal executive offices
are located at 650 Dresher Road, Horsham, Pennsylvania 19044. Its telephone
number is (215) 328-4622. GMACCM conducts operations from its headquarters in
Pennsylvania and from offices located in California, Colorado, the District of
Columbia, Illinois, Michigan, Minnesota, Missouri, Nebraska, New York, Ohio,
Texas, Virginia, Washington and Wisconsin.
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DESCRIPTION OF THE CERTIFICATES
GENERAL
Each series of Certificates will represent the entire beneficial ownership
interest in the Trust Fund created pursuant to the related Pooling and
Servicing Agreement. As described in the related Prospectus Supplement, the
Certificates of each series, including the Offered Certificates of such series,
may consist of one or more classes of Certificates that, among other things:
(i) provide for the accrual of interest on the Certificate Balance or Notional
Amount thereof at a fixed, variable or adjustable rate; (ii) constitute Senior
Certificates or Subordinate Certificates; (iii) constitute Stripped Interest
Certificates or Stripped Principal Certificates; (iv) provide for distributions
of interest thereon or principal thereof that commence only after the
occurrence of certain events, such as the retirement of one or more other
classes of Certificates of such series; (v) provide for distributions of
principal thereof to be made, from time to time or for designated periods, at a
rate that is faster (and, in some cases, substantially faster) or slower (and,
in some cases, substantially slower) than the rate at which payments or other
collections of principal are received on the Mortgage Assets in the related
Trust Fund; (vi) provide for distributions of principal thereof to be made,
subject to available funds, based on a specified principal payment schedule or
other methodology; or (vii) provide for distributions based on collections on
the Mortgage Assets in the related Trust Fund attributable to Prepayment
Premiums and Equity Participations.
If so specified in the related Prospectus Supplement, a class of
Certificates may have two or more component parts, each having characteristics
that are otherwise described herein as being attributable to separate and
distinct classes. For example, a class of Certificates may have a Certificate
Balance on which it accrues interest at a fixed, variable or adjustable rate.
Such class of Certificates may also have certain characteristics attributable
to Stripped Interest Certificates insofar as it may also entitle the holders
thereof to distributions of interest accrued on a Notional Amount at a
different fixed, variable or adjustable rate. In addition, a class of
Certificates may accrue interest on one portion of its Certificate Balance at
one fixed, variable or adjustable rate and on another portion of its
Certificate Balance at a different fixed, variable or adjustable rate.
Each class of Offered Certificates of a series will be issued in minimum
denominations corresponding to the principal balances or, in case of certain
classes of Stripped Interest Certificates or REMIC Residual Certificates,
notional amounts or percentage interests, specified in the related Prospectus
Supplement. As provided in the related Prospectus Supplement, one or more
classes of Offered Certificates of any series may be issued in fully
registered, definitive form (such Certificates, "Definitive Certificates") or
may be offered in book-entry format (such Certificates, "Book-Entry
Certificates") through the facilities of The Depository Trust Company ("DTC").
The Offered Certificates of each series (if issued as Definitive Certificates)
may be transferred or exchanged, subject to any restrictions on transfer
described in the related Prospectus Supplement, at the location specified in
the related Prospectus Supplement, without the payment of any service charges,
other than any tax or other governmental charge payable in connection
therewith. Interests in a class of Book-Entry Certificates will be transferred
on the book-entry records of DTC and its participating organizations.
DISTRIBUTIONS
Distributions on the Certificates of each series will be made on each
Distribution Date from the Available Distribution Amount for such series and
such Distribution Date. Unless otherwise provided in the related Prospectus
Supplement, the "Available Distribution Amount" for any series of Certificates
and any Distribution Date will refer to the total of all payments or other
collections (or advances in lieu thereof) on, under or in respect of the
Mortgage Assets and any other assets included in the related Trust Fund that
are available for distribution to the holders of Certificates of such series on
such date. The particular components of the Available Distribution Amount for
any series and Distribution Date will be more specifically described in the
related Prospectus Supplement Unless otherwise provided in the related
Prospectus Supplement, the Distribution Date for a series of Certificates will
be the 25th day of each month (or, if any such 25th day is not a business day,
the next succeeding business day), commencing in the month immediately
following the month in which such series of Certificates is issued.
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Except as otherwise specified in the related Prospectus Supplement,
distributions on the Certificates of each series (other than the final
distribution in retirement of any such Certificate) will be made to the persons
in whose names such Certificates are registered at the close of business on the
last business day of the month preceding the month in which the applicable
Distribution Date occurs (the "Record Date"). All distributions with respect to
each class of Certificates on each Distribution Date will be allocated pro rata
among the outstanding Certificates in such class in proportion to the
respective Percentage Interests evidenced thereby unless otherwise specified in
the related Prospectus Supplement. Payments will be made either by wire
transfer in immediately available funds to the account of a Certificateholder
at a bank or other entity having appropriate facilities therefor, if such
Certificateholder has provided the person required to make such payments with
wiring instructions no later than the related Record Date or such other date
specified in the related Prospectus Supplement (and, if so provided in the
related Prospectus Supplement, such Certificateholder holds Certificates in the
requisite amount or denomination specified therein), or by check mailed to the
address of such Certificateholder as it appears on the Certificate Register;
provided, however, that the final distribution in retirement of any class of
Certificates (whether Definitive Certificates or Book-Entry Certificates) will
be made only upon presentation and surrender of such Certificates at the
location specified in the notice to Certificateholders of such final
distribution. The undivided percentage interest (the "Percentage Interest")
represented by an Offered Certificate of a particular class will be equal to
the percentage obtained by dividing the initial principal balance or notional
amount of such Certificate by the initial Certificate Balance or Notional
Amount of such class.
DISTRIBUTIONS OF INTEREST ON THE CERTIFICATES
Each class of Certificates of each series (other than certain classes of
Stripped Principal Certificates and certain classes of REMIC Residual
Certificates that have no Pass-Through Rate) may have a different Pass-Through
Rate, which in each case may be fixed, variable or adjustable. The related
Prospectus Supplement will specify the Pass-Through Rate or, in the case of a
variable or adjustable Pass-Through Rate, the method for determining the
Pass-Through Rate, for each class. Unless otherwise specified in the related
Prospectus Supplement, interest on the Certificates of each series will be
calculated on the basis of a 360-day year consisting of twelve 30-day months.
Distributions of interest in respect of any class of Certificates (other
than a class of Accrual Certificates, which will be entitled to distributions
of accrued interest commencing only on the Distribution Date, or under the
circumstances, specified in the related Prospectus Supplement, and other than
any class of Stripped Principal Certificates or REMIC Residual Certificates
that is not entitled to any distributions of interest) will be made on each
Distribution Date based on the Accrued Certificate Interest for such class and
such Distribution Date, subject to the sufficiency of the portion of the
Available Distribution Amount allocable to such class on such Distribution
Date. Prior to the time interest is distributable on any class of Accrual
Certificates, the amount of Accrued Certificate Interest otherwise
distributable on such class will be added to the Certificate Balance thereof on
each Distribution Date or otherwise deferred as described in the related
Prospectus Supplement. With respect to each class of Certificates (other than
certain classes of Stripped Interest Certificates and certain classes of REMIC
Residual Certificates), the "Accrued Certificate Interest" for each
Distribution Date will be equal to interest at the applicable Pass-Through Rate
accrued for a specified period (generally the most recently ended calendar
month) on the outstanding Certificate Balance of such class of Certificates
immediately prior to such Distribution Date. Unless otherwise provided in the
related Prospectus Supplement, the Accrued Certificate Interest for each
Distribution Date on a class of Stripped Interest Certificates will be
similarly calculated except that it will accrue on a Notional Amount that is
either (i) based on the principal balances of some or all of the Mortgage
Assets in the related Trust Fund or (ii) equal to the Certificate Balances of
one or more other classes of Certificates of the same series. Reference to a
Notional Amount with respect to a class of Stripped Interest Certificates is
solely for convenience in making certain calculations and does not represent
the right to receive any distributions of principal. If so specified in the
related Prospectus Supplement, the amount of Accrued Certificate Interest that
is otherwise distributable on (or, in the case of Accrual Certificates, that
may otherwise be added to the Certificate Balance of) one or more classes of
the Certificates of a series may be reduced to the extent that any Prepayment
Interest Shortfalls, as described under "Yield and Maturity
Considerations--Certain Shortfalls in Collections of
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Interest", exceed the amount of any sums that are applied to offset the amount
of such shortfalls. The particular manner in which such shortfalls will be
allocated among some or all of the classes of Certificates of that series will
be specified in the related Prospectus Supplement. The related Prospectus
Supplement will also describe the extent to which the amount of Accrued
Certificate Interest that is otherwise distributable on (or, in the case of
Accrual Certificates, that may otherwise be added to the Certificate Balance
of) a class of Offered Certificates may be reduced as a result of any other
contingencies, including delinquencies, losses and deferred interest on or in
respect of the Mortgage Assets in the related Trust Fund. Unless otherwise
provided in the related Prospectus Supplement, any reduction in the amount of
Accrued Certificate Interest otherwise distributable on a class of Certificates
by reason of the allocation to such class of a portion of any deferred interest
on or in respect of the Mortgage Assets in the related Trust Fund will result
in a corresponding increase in the Certificate Balance of such class. See "Risk
Factors--Yield and Prepayment Considerations" and "Yield and Maturity
Considerations--Certain Shortfalls in Collections of Interest".
DISTRIBUTIONS OF PRINCIPAL OF THE CERTIFICATES
Each class of Certificates of each series (other than certain classes of
Stripped Interest Certificates and certain classes of REMIC Residual
Certificates) will have a Certificate Balance, which, at any time, will equal
the then maximum amount that the holders of Certificates of such class will be
entitled to receive as principal out of the future cash flow on the Mortgage
Assets and other assets included in the related Trust Fund. The outstanding
Certificate Balance of a class of Certificates will be reduced by distributions
of principal made thereon from time to time and, if so provided in the related
Prospectus Supplement, further by any losses incurred in respect of the related
Mortgage Assets allocated thereto from time to time. In turn, the outstanding
Certificate Balance of a class of Certificates may be increased as a result of
any deferred interest on or in respect of the related Mortgage Assets being
allocated thereto from time to time, and will be increased, in the case of a
class of Accrual Certificates prior to the Distribution Date on which
distributions of interest thereon are required to commence, by the amount of
any Accrued Certificate Interest in respect thereof (reduced as described
above). Unless otherwise provided in the related Prospectus Supplement, the
initial aggregate Certificate Balance of all classes of a series of
Certificates will not be greater than the aggregate outstanding principal
balance of the related Mortgage Assets as of a specified date (the "Cut-Off
Date"), after application of scheduled payments due on or before such date,
whether or not received. The initial Certificate Balance of each class of a
series of Certificates will be specified in the related Prospectus Supplement.
As and to the extent described in the related Prospectus Supplement,
distributions of principal with respect to a series of Certificates will be
made on each Distribution Date to the holders of the class or classes of
Certificates of such series entitled thereto until the Certificate Balances of
such Certificates have been reduced to zero. Distributions of principal with
respect to one or more classes of Certificates may be made at a rate that is
faster (and, in some cases, substantially faster) than the rate at which
payments or other collections of principal are received on the Mortgage Assets
in the related Trust Fund. Distributions of principal with respect to one or
more classes of Certificates may not commence until the occurrence of certain
events, such as the retirement of one or more other classes of Certificates of
the same series, or may be made at a rate that is slower (and, in some cases,
substantially slower) than the rate at which payments or other collections of
principal are received on the Mortgage Assets in the related Trust Fund.
Distributions of principal with respect to one or more classes of Certificates
(each such class, a "Controlled Amortization Class") may be made, subject to
available funds, based on a specified principal payment schedule. Distributions
of principal with respect to one or more classes of Certificates (each such
class, a "Companion Class") may be contingent on the specified principal
payment schedule for a Controlled Amortization Class of the same series and the
rate at which payments and other collections of principal on the Mortgage
Assets in the related Trust Fund are received. Unless otherwise specified in
the related Prospectus Supplement, distributions of principal of any class of
Offered Certificates will be made on a pro rata basis among all of the
Certificates of such class.
ALLOCATION OF LOSSES AND SHORTFALLS
The amount of any losses or shortfalls in collections on the Mortgage
Assets in any Trust Fund (to the extent not covered or offset by draws on any
reserve fund or under any instrument of Credit Support)
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will be allocated among the respective classes of Certificates of the related
series in the priority and manner, and subject to the limitations, specified in
the related Prospectus Supplement. As described in the related Prospectus
Supplement, such allocations may be effected by a reduction in the entitlements
to interest and/or the Certificate Balances of one or more such classes of
Certificates, or by establishing a priority of payments among such classes of
Certificates. See "Description of Credit Support".
ADVANCES IN RESPECT OF DELINQUENCIES
If and to the extent provided in the related Prospectus Supplement, if a
Trust Fund includes Mortgage Loans, the Master Servicer, a Special Servicer,
the Trustee, the Fiscal Agent (if any), any provider of Credit Support and/or
any other specified person may be obligated to advance, or have the option of
advancing, on or before each Distribution Date, from its or their own funds or
from excess funds held in the related Certificate Account that are not part of
the Available Distribution Amount for the related series of Certificates for
such Distribution Date, an amount up to the aggregate of any payments of
principal (other than the principal portion of any balloon payments) and
interest that were due on or in respect of such Mortgage Loans during the
related Due Period and were delinquent on the related Determination Date.
Advances are intended to maintain a regular flow of scheduled interest and
principal payments to holders of the class or classes of Certificates entitled
thereto, rather than to guarantee or insure against losses. Accordingly, all
advances made out of a specific entity's own funds will be reimbursable out of
related recoveries on the Mortgage Loans (including amounts drawn under any
fund or instrument constituting Credit Support) respecting which such advances
were made (as to any Mortgage Loan, "Related Proceeds") and such other specific
sources as may be identified in the related Prospectus Supplement, including in
the case of a series that includes one or more classes of Subordinate
Certificates, collections on other Mortgage Assets in the related Trust Fund
that would otherwise be distributable to the holders of one or more classes of
such Subordinate Certificates. No advance will be required to be made by a
Master Servicer, Special Servicer, Fiscal Agent or Trustee if, in the judgment
of the Master Servicer, Special Servicer, Fiscal Agent or Trustee, as the case
may be, such advance would not be recoverable from Related Proceeds or another
specifically identified source (any such advance, a "Nonrecoverable Advance");
and, if previously made by a Master Servicer, Special Servicer, Fiscal Agent or
Trustee, a Nonrecoverable Advance will be reimbursable thereto from any amounts
in the related Certificate Account prior to any distributions being made to the
related series of Certificateholders.
If advances have been made by a Master Servicer, Special Servicer, Fiscal
Agent, Trustee or other entity from excess funds in a Certificate Account, such
Master Servicer, Special Servicer, Fiscal Agent, Trustee or other entity, as
the case may be, will be required to replace such funds in such Certificate
Account on any future Distribution Date to the extent that funds in such
Certificate Account on such Distribution Date are less than payments required
to be made to the related series of Certificateholders on such date. If so
specified in the related Prospectus Supplement, the obligation of a Master
Servicer, Special Servicer, Fiscal Agent, Trustee or other entity to make
advances may be secured by a cash advance reserve fund or a surety bond. If
applicable, information regarding the characteristics of, and the identity of
any obligor on, any such surety bond, will be set forth in the related
Prospectus Supplement.
If and to the extent so provided in the related Prospectus Supplement, any
entity making advances will be entitled to receive interest on certain or all
of such advances for a specified period during which such advances are
outstanding at the rate specified in such Prospectus Supplement, and such
entity will be entitled to payment of such interest periodically from general
collections on the Mortgage Loans in the related Trust Fund prior to any
payment to the related series of Certificateholders or as otherwise provided in
the related Pooling and Servicing Agreement and described in such Prospectus
Supplement.
The Prospectus Supplement for any series of Certificates evidencing an
interest in a Trust Fund that includes MBS will describe any comparable
advancing obligation of a party to the related Pooling and Servicing Agreement
or of a party to the related MBS Agreement.
REPORTS TO CERTIFICATEHOLDERS
On each Distribution Date, together with the distribution to the holders
of each class of the Offered Certificates of a series, a Master Servicer,
Manager or Trustee, as provided in the related Prospectus
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Supplement, will forward to each such holder, a statement (a "Distribution Date
Statement") that, unless otherwise provided in the related Prospectus
Supplement, will set forth, among other things, in each case to the extent
applicable:
(i) the amount of such distribution to holders of such class of Offered
Certificates that was applied to reduce the Certificate Balance thereof;
(ii) the amount of such distribution to holders of such class of Offered
Certificates that was applied to pay Accrued Certificate Interest;
(iii) the amount, if any, of such distribution to holders of such class
of Offered Certificates that was allocable to (A) Prepayment Premiums and
(B) payments on account of Equity Participations;
(iv) the amount, if any, by which such distribution is less than the
amounts to which holders of such class of Offered Certificates are
entitled;
(v) if the related Trust Fund includes Mortgage Loans, the aggregate
amount of advances included in such distribution;
(vi) if the related Trust Fund includes Mortgage Loans, the amount of
servicing compensation received by the related Master Servicer (and, if
payable directly out of the related Trust Fund, by any Special Servicer and
any Sub-Servicer) and, if the related Trust Fund includes MBS, the amount
of administrative compensation received by the REMIC Administrator;
(vii) information regarding the aggregate principal balance of the
related Mortgage Assets on or about such Distribution Date;
(viii) if the related Trust Fund includes Mortgage Loans, information
regarding the number and aggregate principal balance of such Mortgage Loans
that are delinquent;
(ix) if the related Trust Fund includes Mortgage Loans, information
regarding the aggregate amount of losses incurred and principal prepayments
made with respect to such Mortgage Loans during the related Prepayment
Period (that is, the specified period, generally corresponding to the
related Due Period, during which prepayments and other unscheduled
collections on the Mortgage Loans in the related Trust Fund must be
received in order to be distributed on a particular Distribution Date);
(x) the Certificate Balance or Notional Amount, as the case may be, of
such class of Certificates at the close of business on such Distribution
Date, separately identifying any reduction in such Certificate Balance or
Notional Amount due to the allocation of any losses in respect of the
related Mortgage Assets, any increase in such Certificate Balance or
Notional Amount due to the allocation of any negative amortization in
respect of the related Mortgage Assets and any increase in the Certificate
Balance of a class of Accrual Certificates, if any, in the event that
Accrued Certificate Interest has been added to such balance;
(xi) if such class of Offered Certificates has a variable Pass-Through
Rate or an adjustable Pass-Through Rate, the Pass-Through Rate applicable
thereto for such Distribution Date and, if determinable, for the next
succeeding Distribution Date;
(xii) the amount deposited in or withdrawn from any reserve fund on such
Distribution Date, and the amount remaining on deposit in such reserve fund
as of the close of business on such Distribution Date;
(xiii) if the related Trust Fund includes one or more instruments of
Credit Support, such as a letter of credit, an insurance policy and/or a
surety bond, the amount of coverage under each such instrument as of the
close of business on such Distribution Date; and
(xiv) the amount of Credit Support being afforded by any classes of
Subordinate Certificates.
In the case of information furnished pursuant to subclauses (i)-(iii)
above, the amounts will be expressed as a dollar amount per minimum
denomination of the relevant class of Offered Certificates or as a percentage.
The Prospectus Supplement for each series of Certificates may describe
additional information to be included in reports to the holders of the Offered
Certificates of such series.
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Within a reasonable period of time after the end of each calendar year,
the Master Servicer, Manager or Trustee for a series of Certificates, as the
case may be, will be required to furnish to each person who at any time during
the calendar year was a holder of an Offered Certificate of such series a
statement containing the information set forth in subclauses (i)-(iii) above,
aggregated for such calendar year or the applicable portion thereof during
which such person was a Certificateholder. Such obligation will be deemed to
have been satisfied to the extent that substantially comparable information is
provided pursuant to any requirements of the Code as are from time to time in
force. See, however, "--Book-Entry Registration and Definitive Certificates"
below.
If the Trust Fund for a series of Certificates includes MBS, the ability
of the related Master Servicer, Manager or Trustee, as the case may be, to
include in any Distribution Date Statement information regarding the mortgage
loans underlying such MBS will depend on the reports received with respect to
such MBS. In such cases, the related Prospectus Supplement will describe the
loan-specific information to be included in the Distribution Date Statements
that will be forwarded to the holders of the Offered Certificates of that
series in connection with distributions made to them.
TERMINATION; RETIREMENT OF CERTIFICATES
The obligations created by the Pooling and Servicing Agreement for each
series of Certificates (other than limited payment and notice obligations of
the applicable parties) will terminate upon the payment to Certificateholders
of that series of all amounts held in the Certificate Account or by the Master
Servicer and required to be paid to them pursuant to such Pooling and Servicing
Agreement following the earlier of (i) the final payment or other liquidation
or disposition (or any advance with respect thereto) of the last Mortgage Asset
subject thereto or of any property acquired upon foreclosure or deed in lieu of
foreclosure of any Mortgage Loan subject thereto and (ii) the purchase by the
Master Servicer, the Depositor or, if specified in the related Prospectus
Supplement, by the holder of the REMIC Residual Certificates (see "Certain
Federal Income Tax Consequences" below) from the Trust Fund for such series of
all remaining Mortgage Assets therein and property, if any, acquired in respect
of the Mortgage Loans therein. In addition to the foregoing, the Master
Servicer or the Depositor will have the option to purchase, in whole but not in
part, the Certificates specified in the related Prospectus Supplement in the
manner set forth in the related Prospectus Supplement. Upon the purchase of
such Certificates or at any time thereafter, at the option of the Master
Servicer or the Depositor, the Mortgage Assets may be sold, thereby effecting a
retirement of the Certificates and the termination of the Trust Fund, or the
Certificates so purchased may be held or resold by the Master Servicer or the
Depositor. In no event, however, will the trust created continue beyond the
expiration of 21 years from the death of the survivor of certain persons named
in such Pooling and Servicing Agreement. Written notice of termination of the
Pooling and Servicing Agreement will be given to each Certificateholder, and
the final distribution will be made only upon surrender and cancellation of the
Certificates at an office or agency appointed by the Trustee which will be
specified in the notice of termination. If the Certificateholders are permitted
to terminate the trust under the applicable Pooling and Servicing Agreement, a
penalty may be imposed upon the Certificateholders based upon the fee that
would be foregone by the Master Servicer and/or any Special Servicer because of
such termination.
Any such purchase of Mortgage Assets and property acquired in respect of
Mortgage Loans evidenced by a series of Certificates shall be made at the
option of the Master Servicer, the Depositor or, if applicable, the holder of
the REMIC Residual Certificates at the price specified in the related
Prospectus Supplement. The exercise of such right will effect early retirement
of the Certificates of that series, but the right of the Master Servicer, the
Depositor or, if applicable, such holder to so purchase is subject to the
aggregate principal balance of the Mortgage Assets for that series as of the
Distribution Date on which the purchase proceeds are to be distributed to
Certificateholders being less than the percentage specified in the related
Prospectus Supplement of the aggregate principal balance of the Mortgage Assets
at the Cut-off Date for that series. The Prospectus Supplement for each series
of Certificates will set forth the amounts that the holders of such
Certificates will be entitled to receive upon such early retirement. Such early
termination may adversely affect the yield to holders of certain classes of
such Certificates. If a REMIC election has been made, the termination of the
related Trust Fund will be effected in a manner consistent with applicable
federal income tax regulations and its status as a REMIC.
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BOOK-ENTRY REGISTRATION AND DEFINITIVE CERTIFICATES
If so provided in the Prospectus Supplement for a series of Certificates,
one or more classes of the Offered Certificates of such series will be offered
in book-entry format through the facilities of DTC, and each such class will be
represented by one or more global Certificates registered in the name of DTC or
its nominee.
DTC is a limited-purpose trust company organized under the New York
Banking Law, a "banking corporation" within the meaning of the New York Banking
Law, a member of the Federal Reserve System, a "clearing corporation" within
the meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. DTC
was created to hold securities for its participating organizations
("Participants") and facilitate the clearance and settlement of securities
transactions between Participants through electronic computerized book-entry
changes in their accounts, thereby eliminating the need for physical movement
of securities certificates. "Direct Participants", which maintain accounts with
DTC, include securities brokers and dealers, banks, trust companies and
clearing corporations and may include certain other organizations. DTC is owned
by a number of its Direct Participants and by the New York Stock Exchange,
Inc., the American Stock Exchange, Inc. and the National Association of
Securities Dealers, Inc. Access to the DTC system also is available to others
such as banks, brokers, dealers and trust companies that clear through or
maintain a custodial relationship with a Direct Participant, either directly or
indirectly ("Indirect Participants"). The rules applicable to DTC and its
Participants are on file with the Commission.
Purchases of Book-Entry Certificates under the DTC system must be made by
or through Direct Participants, which will receive a credit for the Book-Entry
Certificates on DTC's records. The ownership interest of each actual purchaser
of a Book-Entry Certificate (a "Certificate Owner") is in turn to be recorded
on the Direct and Indirect Participants' records. Certificate Owners will not
receive written confirmation from DTC of their purchases, but Certificate
Owners are expected to receive written confirmations providing details of such
transactions, as well as periodic statements of their holdings, from the Direct
or Indirect Participant through which each Certificate Owner entered into the
transaction. Transfers of ownership interest in the Book-Entry Certificates are
to be accomplished by entries made on the books of Participants acting on
behalf of Certificate Owners. Certificate Owners will not receive certificates
representing their ownership interests in the Book-Entry Certificates, except
in the event that use of the book-entry system for the Book-Entry Certificates
of any series is discontinued as described below.
DTC has no knowledge of the actual Certificate Owners of the Book-Entry
Certificates; DTC's records reflect only the identity of the Direct
Participants to whose accounts such Certificates are credited, which may or may
not be the Certificate Owners. The Participants will remain responsible for
keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Certificate Owners will be governed
by arrangements among them, subject to any statutory or regulatory requirements
as may be in effect from time to time.
Distributions on the Book-Entry Certificates will be made to DTC. DTC's
practice is to credit Direct Participants' accounts on the related Distribution
Date in accordance with their respective holdings shown on DTC's records unless
DTC has reason to believe that it will not receive payment on such date.
Disbursement of such distributions by Participants to Certificate Owners will
be governed by standing instructions and customary practices, as is the case
with securities held for the accounts of customers in bearer form or registered
in "street name", and will be the responsibility of each such Participant (and
not of DTC, the Depositor or any Trustee or Master Servicer), subject to any
statutory or regulatory requirements as may be in effect from time to time.
Under a book-entry system, Certificate Owners may receive payments after the
related Distribution Date.
Unless otherwise provided in the related Prospectus Supplement, the only
"Certificateholder" (as such term is used in the related Pooling and Servicing
Agreement) of Book-Entry Certificates will be the
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nominee of DTC, and the Certificate Owners will not be recognized as
Certificateholders under the Pooling and Servicing Agreement. Certificate
Owners will be permitted to exercise the rights of Certificateholders under the
related Pooling and Servicing Agreement only indirectly through the
Participants who in turn will exercise their rights through DTC. The Depositor
is informed that DTC will take action permitted to be taken by a
Certificateholder under a Pooling and Servicing Agreement only at the direction
of one or more Participants to whose account with DTC interests in the
Book-Entry Certificates are credited.
Because DTC can act only on behalf of Participants, who in turn act on
behalf of Indirect Participants and certain Certificate Owners, the ability of
a Certificate Owner to pledge its interest in Book-Entry Certificates to
persons or entities that do not participate in the DTC system, or otherwise
take actions in respect of its interest in Book-Entry Certificates, may be
limited due to the lack of a physical certificate evidencing such interest.
Unless otherwise specified in the related Prospectus Supplement,
Certificates initially issued in book-entry form will be issued as Definitive
Certificates to Certificate Owners or their nominees, rather than to DTC or its
nominee, only if (i) the Depositor advises the Trustee in writing that DTC is
no longer willing or able to discharge properly its responsibilities as
depository with respect to such Certificates and the Depositor is unable to
locate a qualified successor or (ii) the Depositor, at its option, elects to
terminate the book-entry system through DTC with respect to such Certificates.
Upon the occurrence of either of the events described in the preceding
sentence, DTC will be required to notify all Participants of the availability
through DTC of Definitive Certificates. Upon surrender by DTC of the
certificate or certificates representing a class of Book-Entry Certificates,
together with instructions for registration, the Trustee for the related series
or other designated party will be required to issue to the Certificate Owners
identified in such instructions the Definitive Certificates to which they are
entitled, and thereafter the holders of such Definitive Certificates will be
recognized as Certificateholders under the related Pooling and Servicing
Agreement.
THE POOLING AND SERVICING AGREEMENTS
GENERAL
The Certificates of each series will be issued pursuant to a Pooling and
Servicing Agreement. In general, the parties to a Pooling and Servicing
Agreement will include the Depositor, the Trustee, the Master Servicer and, in
some cases, a Special Servicer appointed as of the date of the Pooling and
Servicing Agreement. However, a Pooling and Servicing Agreement that relates to
a Trust Fund that includes MBS may include a Manager as a party, but may not
include a Master Servicer or other servicer as a party. All parties to each
Pooling and Servicing Agreement under which Certificates of a series are issued
will be identified in the related Prospectus Supplement. If so specified in the
related Prospectus Supplement, an affiliate of the Depositor, or the Mortgage
Asset Seller or an affiliate thereof, may perform the functions of Master
Servicer, Special Servicer or Manager. Any party to a Pooling and Servicing
Agreement or any affiliate thereof may own Certificates issued thereunder.
A form of a pooling and servicing agreement has been filed as an exhibit
to the Registration Statement of which this Prospectus is a part. However, the
provisions of each Pooling and Servicing Agreement will vary depending upon the
nature of the Certificates to be issued thereunder and the nature of the
related Trust Fund. The following summaries describe certain provisions that
may appear in a Pooling and Servicing Agreement under which Certificates that
evidence interests in Mortgage Loans will be issued. The Prospectus Supplement
for a series of Certificates will describe any provision of the related Pooling
and Servicing Agreement that materially differs from the description thereof
contained in this Prospectus and, if the related Trust Fund includes MBS, will
summarize all of the material provisions of the related Pooling and Servicing
Agreement. The summaries herein do not purport to be complete and are subject
to, and are qualified in their entirety by reference to, all of the provisions
of the Pooling and Servicing Agreement for each series of Certificates and the
description of such provisions in the related
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Prospectus Supplement. The Depositor will provide a copy of the Pooling and
Servicing Agreement (without exhibits) that relates to any series of
Certificates without charge upon written request of a holder of a Certificate
of such series addressed to it at its principal executive offices specified
herein under "The Depositor".
ASSIGNMENT OF MORTGAGE LOANS; REPURCHASES
At the time of issuance of any series of Certificates, the Depositor will
assign (or cause to be assigned) to the designated Trustee the Mortgage Loans
to be included in the related Trust Fund, together with, unless otherwise
specified in the related Prospectus Supplement, all principal and interest to
be received on or with respect to such Mortgage Loans after the Cut-off Date,
other than principal and interest due on or before the Cut-off Date. The
Trustee will, concurrently with such assignment, deliver the Certificates to or
at the direction of the Depositor in exchange for the Mortgage Loans and the
other assets to be included in the Trust Fund for such series. Each Mortgage
Loan will be identified in a schedule appearing as an exhibit to the related
Pooling and Servicing Agreement. Such schedule generally will include detailed
information that pertains to each Mortgage Loan included in the related Trust
Fund, which information will typically include the address of the related
Mortgaged Property and type of such property; the Mortgage Rate and, if
applicable, the applicable index, gross margin, adjustment date and any rate
cap information; the original and remaining term to maturity; the original
amortization term; and the original and outstanding principal balance.
In addition, unless otherwise specified in the related Prospectus
Supplement, the Depositor will, as to each Mortgage Loan to be included in a
Trust Fund, deliver, or cause to be delivered, to the related Trustee (or to a
custodian appointed by the Trustee as described below) the Mortgage Note
endorsed, without recourse, either in blank or to the order of such Trustee (or
its nominee), the Mortgage with evidence of recording indicated thereon (except
for any Mortgage not returned from the public recording office), an assignment
of the Mortgage in blank or to the Trustee (or its nominee) in recordable form,
together with any intervening assignments of the Mortgage with evidence of
recording thereon (except for any such assignment not returned from the public
recording office), and, if applicable, any riders or modifications to such
Mortgage Note and Mortgage, together with certain other documents at such times
as set forth in the related Pooling and Servicing Agreement. Such assignments
may be blanket assignments covering Mortgages on Mortgaged Properties located
in the same county, if permitted by law. Notwithstanding the foregoing, a Trust
Fund may include Mortgage Loans where the original Mortgage Note is not
delivered to the Trustee if the Depositor delivers, or causes to be delivered,
to the related Trustee (or such custodian) a copy or a duplicate original of
the Mortgage Note, together with an affidavit certifying that the original
thereof has been lost or destroyed. In addition, if the Depositor cannot
deliver, with respect to any Mortgage Loan, the Mortgage or any intervening
assignment with evidence of recording thereon concurrently with the execution
and delivery of the related Pooling and Servicing Agreement because of a delay
caused by the public recording office, the Depositor will deliver, or cause to
be delivered, to the related Trustee (or such custodian) a true and correct
photocopy of such Mortgage or assignment as submitted for recording. The
Depositor will deliver, or cause to be delivered, to the related Trustee (or
such custodian) such Mortgage or assignment with evidence of recording
indicated thereon after receipt thereof from the public recording office. If
the Depositor cannot deliver, with respect to any Mortgage Loan, the Mortgage
or any intervening assignment with evidence of recording thereon concurrently
with the execution and delivery of the related Pooling and Servicing Agreement
because such Mortgage or assignment has been lost, the Depositor will deliver,
or cause to be delivered, to the related Trustee (or such custodian) a true and
correct photocopy of such Mortgage or assignment with evidence of recording
thereon. Unless otherwise specified in the related Prospectus Supplement,
assignments of Mortgage to the Trustee (or its nominee) will be recorded in the
appropriate public recording office, except in states where, in the opinion of
counsel acceptable to the Trustee, such recording is not required to protect
the Trustee's interests in the Mortgage Loan against the claim of any
subsequent transferee or any successor to or creditor of the Depositor or the
originator of such Mortgage Loan.
The Trustee (or a custodian appointed by the Trustee) for a series of
Certificates will be required to review the Mortgage Loan documents delivered
to it within a specified period of days after receipt thereof, and the Trustee
(or such custodian) will hold such documents in trust for the benefit of the
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Certificateholders of such series. Unless otherwise specified in the related
Prospectus Supplement, if any such document is found to be missing or
defective, and such omission or defect, as the case may be, materially and
adversely affects the interests of the Certificateholders of the related
series, the Trustee (or such custodian) will be required to notify the Master
Servicer and the Depositor, and one of such persons will be required to notify
the relevant Mortgage Asset Seller. In that case, and if the Mortgage Asset
Seller cannot deliver the document or cure the defect within a specified number
of days after receipt of such notice, then, except as otherwise specified below
or in the related Prospectus Supplement, the Mortgage Asset Seller will be
obligated to repurchase the related Mortgage Loan from the Trustee at a price
generally equal to the unpaid principal balance thereof, together with accrued
but unpaid interest through a date on or about the date of purchase, or at such
other price as will be specified in the related Prospectus Supplement (in any
event, the "Purchase Price"). If so provided in the Prospectus Supplement for a
series of Certificates, a Mortgage Asset Seller, in lieu of repurchasing a
Mortgage Loan as to which there is missing or defective loan documentation,
will have the option, exercisable upon certain conditions and/or within a
specified period after initial issuance of such series of Certificates, to
replace such Mortgage Loan with one or more other mortgage loans, in accordance
with standards that will be described in the Prospectus Supplement. Unless
otherwise specified in the related Prospectus Supplement, this repurchase or
substitution obligation will constitute the sole remedy to holders of the
Certificates of any series or to the related Trustee on their behalf for
missing or defective Mortgage Asset documentation and neither the Depositor
nor, unless it is the Mortgage Asset Seller, the Master Servicer will be
obligated to purchase or replace a Mortgage Loan if a Mortgage Asset Seller
defaults on its obligation to do so.
The Trustee will be authorized at any time to appoint one or more
custodians pursuant to a custodial agreement to hold title to the Mortgage
Loans in any Trust Fund, and to maintain possession of and, if applicable, to
review, the documents relating to such Mortgage Loans, in any case as the agent
of the Trustee. The identity of any such custodian to be appointed on the date
of initial issuance of the Certificates will be set forth in the related
Prospectus Supplement. Any such custodian may be an affiliate of the Depositor
or the Master Servicer.
REPRESENTATIONS AND WARRANTIES; REPURCHASES
Unless otherwise provided in the Prospectus Supplement for a series of
Certificates, the Depositor will, with respect to each Mortgage Loan in the
related Trust Fund, make or assign, or cause to be made or assigned, certain
representations and warranties (the person making such representations and
warranties, the "Warranting Party") covering, by way of example: (i) the
accuracy of the information set forth for such Mortgage Loan on the schedule of
Mortgage Loans appearing as an exhibit to the related Pooling and Servicing
Agreement; (ii) the enforceability of the related Mortgage Note and Mortgage
and the existence of title insurance insuring the lien priority of the related
Mortgage; (iii) the Warranting Party's title to the Mortgage Loan and the
authority of the Warranting Party to sell the Mortgage Loan; and (iv) the
payment status of the Mortgage Loan. It is expected that in most cases the
Warranting Party will be the Mortgage Asset Seller; however, the Warranting
Party may also be an affiliate of the Mortgage Asset Seller, the Depositor or
an affiliate of the Depositor, the Master Servicer, a Special Servicer or
another person acceptable to the Depositor. The Warranting Party, if other than
the Mortgage Asset Seller, will be identified in the related Prospectus
Supplement.
Unless otherwise provided in the related Prospectus Supplement, the Master
Servicer and/or Trustee will be required to notify promptly any Warranting
Party of any breach of any representation or warranty made by it in respect of
a Mortgage Loan that materially and adversely affects the interests of the
Certificateholders of the related series. If such Warranting Party cannot cure
such breach within a specified period following the date on which it was
notified of such breach, then, unless otherwise provided in the related
Prospectus Supplement, it will be obligated to repurchase such Mortgage Loan
from the Trustee at the applicable Purchase Price. If so provided in the
Prospectus Supplement for a series of Certificates, a Warranting Party, in lieu
of repurchasing a Mortgage Loan as to which a breach has occurred, will have
the option, exercisable upon certain conditions and/or within a specified
period after initial issuance of such series of Certificates, to replace such
Mortgage Loan with one or more other mortgage loans, in accordance with
standards that will be described in the Prospectus Supplement. Unless otherwise
specified in the related Prospectus Supplement, this repurchase or substitution
obligation will
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constitute the sole remedy available to holders of the Certificates of any
series or to the related Trustee on their behalf for a breach of representation
and warranty by a Warranting Party and neither the Depositor nor the Master
Servicer, in either case unless it is the Warranting Party, will be obligated
to purchase or replace a Mortgage Loan if a Warranting Party defaults on its
obligation to do so.
Representations and warranties may be made in respect of a Mortgage Loan
as of a date prior to the date upon which the related series of Certificates is
issued, and thus may not address events that may occur following the date as of
which they were made. The date as of which the representations and warranties
regarding the Mortgage Loans in any Trust Fund were made will be specified in
the related Prospectus Supplement.
COLLECTION AND OTHER SERVICING PROCEDURES
Unless otherwise specified in the related Prospectus Supplement, the
Master Servicer for any Mortgage Pool, directly or through Sub-Servicers, will
be obligated under the related Pooling and Servicing Agreement to service and
administer the Mortgage Loans in such Mortgage Pool for the benefit of the
related Certificateholders, in accordance with applicable law and with the
terms of such Pooling and Servicing Agreement, such Mortgage Loans and any
instrument of Credit Support included in the related Trust Fund. Subject to the
foregoing, the Master Servicer will have full power and authority to do any and
all things in connection with such servicing and administration that it may
deem necessary and desirable.
As part of its servicing duties, a Master Servicer will be required to
make reasonable efforts to collect all payments called for under the terms and
provisions of the Mortgage Loans that it services and will be obligated to
follow such collection procedures as it would follow with respect to mortgage
loans that are comparable to such Mortgage Loans and held for its own account,
provided (i) such procedures are consistent with the terms of the related
Pooling and Servicing Agreement, and (ii) do not impair recovery under any
instrument of Credit Support included in the related Trust Fund. Consistent
with the foregoing, the Master Servicer will be permitted, in its discretion,
unless otherwise specified in the related Prospectus Supplement, to waive any
Prepayment Premium, late payment charge or other charge in connection with any
Mortgage Loan.
Under a Pooling and Servicing Agreement, a Master Servicer or Special
Servicer will be granted certain discretion to extend relief to Mortgagors
whose payments become delinquent. Unless otherwise specified in the related
Prospectus Supplement, if a material default occurs or a payment default is
reasonably foreseeable with respect to a Mortgage Loan, the Master Servicer or
Special Servicer will be permitted, subject to any specific limitations set
forth in the related Pooling and Servicing Agreement and described in the
related Prospectus Supplement, to modify, waive or amend any term of such
Mortgage Loan, including deferring payments, extending the stated maturity date
or otherwise adjusting the payment schedule, provided that such modification,
waiver or amendment (i) is reasonably likely to produce a greater recovery with
respect to such Mortgage Loan on a present value basis than would liquidation
and (ii) will not adversely affect the coverage under any applicable instrument
of Credit Support.
A mortgagor's failure to make required Mortgage Loan payments may mean
that operating income is insufficient to service the mortgage debt, or may
reflect the diversion of that income from the servicing of the mortgage debt.
In addition, a mortgagor that is unable to make Mortgage Loan payments may also
be unable to make timely payment of taxes and otherwise to maintain and insure
the related Mortgaged Property. In general, the related Master Servicer will be
required to monitor any Mortgage Loan that is in default, 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 cure is likely, inspect
the related Mortgaged Property and take such other actions as it deems
necessary and appropriate. A significant period of time may elapse before the
Master Servicer is able to assess the success of any such corrective action or
the need for additional initiatives. The time within which the Master Servicer
can make the initial determination of appropriate action, evaluate the success
of corrective action, develop additional initiatives, institute foreclosure
proceedings and actually foreclose (or accept a deed to a Mortgaged Property in
lieu of foreclosure) on behalf of the Certificateholders of the related series
may vary considerably depending on the particular
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Mortgage Loan, the Mortgaged Property, the mortgagor, the presence of an
acceptable party to assume the Mortgage Loan and the laws of the jurisdiction
in which the Mortgaged Property is located. If a mortgagor files a bankruptcy
petition, the Master Servicer may not be permitted to accelerate the maturity
of the Mortgage Loan or to foreclose on the related Mortgaged Property for a
considerable period of time. See "Certain Legal Aspects of Mortgage
Loans--Bankruptcy Laws."
Mortgagors may, from time to time, request partial releases of the
Mortgaged Properties, easements, consents to alteration or demolition and other
similar matters. The Master Servicer may approve such a request if it has
determined, exercising its business judgment in the same manner as it would if
it were the owner of the related Mortgage Loan, that such approval will not
adversely affect the security for, or the timely and full collectability of,
the related Mortgage Loan; provided, however, that the Master Servicer will not
approve such a request if a REMIC election has been made and such request would
not (in the opinion of independent counsel) result in the imposition of a tax
on the Trust Fund or cause the Trust Fund (or any designated portion thereof)
to fail to qualify as a REMIC under the Code at any time that any Certificate
is outstanding. Any fee collected by the Master Servicer for processing such
request will be retained by the Master Servicer as additional servicing
compensation.
In the case of Mortgage Loans secured by junior liens on the related
Mortgaged Properties, unless otherwise provided in the related Prospectus
Supplement, the Master Servicer will be required to file (or cause to be filed)
of record a request for notice of any action by a superior lienholder under the
Senior Lien for the protection of the related Trustee's interest, where
permitted by local law and whenever applicable state law does not require that
a junior lienholder be named as a party defendant in foreclosure proceedings in
order to foreclose such junior lienholder's equity of redemption. Unless
otherwise specified in the related Prospectus Supplement, the Master Servicer
also will be required to notify any superior lienholder in writing of the
existence of the Mortgage Loan and request notification of any action (as
described below) to be taken against the mortgagor or the Mortgaged Property by
the superior lienholder. If the Master Servicer is notified that any superior
lienholder has accelerated or intends to accelerate the obligations secured by
the related Senior Lien, or has declared or intends to declare a default under
the mortgage or the promissory note secured thereby, or has filed or intends to
file an election to have the related Mortgaged Property sold or foreclosed,
then, unless otherwise specified in the related Prospectus Supplement, the
Master Servicer will be required to take, on behalf of the related Trust Fund,
whatever actions are necessary to protect the interests of the related
Certificateholders, and/or to preserve the security of the related Mortgage
Loan, subject to the application of the REMIC Provisions. Unless otherwise
specified in the related Prospectus Supplement, the Master Servicer will be
required to advance the necessary funds to cure the default or reinstate the
Senior Lien, if such advance is in the best interests of the related
Certificateholders and the Master Servicer determines such advances are
recoverable out of payments on or proceeds of the related Mortgage Loan.
The Master Servicer for any Trust Fund, directly or through Sub-Servicers,
will also be required to perform as to the Mortgage Loans in such Trust Fund
various other customary functions of a servicer of comparable loans, including
maintaining escrow or impound accounts, if required under the related Pooling
and Servicing Agreement, for payment of taxes, insurance premiums, ground rents
and similar items, or otherwise monitoring the timely payment of those items;
attempting to collect delinquent payments; supervising foreclosures;
negotiating modifications; conducting property inspections on a periodic or
other basis; managing (or overseeing the management of) Mortgaged Properties
acquired on behalf of such Trust Fund through foreclosure, deed-in-lieu of
foreclosure or otherwise (each, an "REO Property"); and maintaining servicing
records relating to such Mortgage Loans. Unless otherwise specified in the
related Prospectus Supplement, the Master Servicer will be responsible for
filing and settling claims in respect of particular Mortgage Loans under any
applicable instrument of Credit Support. See "Description of Credit Support".
SUB-SERVICERS
A Master Servicer may delegate its servicing obligations in respect of the
Mortgage Loans serviced thereby to one or more third-party servicers (each, a
"Sub-Servicer"); provided that, unless otherwise specified in the related
Prospectus Supplement, such Master Servicer will remain obligated under the
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related Pooling and Servicing Agreement. A Sub-Servicer for any series of
Certificates may be an affiliate of the Depositor or Master Servicer. Unless
otherwise provided in the related Prospectus Supplement, each sub-servicing
agreement between a Master Servicer and a Sub-Servicer (a "Sub-Servicing
Agreement") will provide for servicing of the applicable Mortgage Loans
consistent with the related Pooling and Servicing Agreement. A Master Servicer
will be required to monitor the performance of Sub-Servicers retained by it and
will 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.
Unless otherwise provided in the related Prospectus Supplement, a Master
Servicer will be solely liable for all fees owed by it to any Sub-Servicer,
irrespective of whether the Master Servicer's compensation pursuant to the
related Pooling and Servicing Agreement is sufficient to pay such fees. Each
Sub-Servicer will be reimbursed by the Master Servicer that retained it for
certain expenditures which it makes, generally to the same extent the Master
Servicer would be reimbursed under a Pooling and Servicing Agreement. See
"--Certificate Account" and "--Servicing Compensation and Payment of Expenses".
SPECIAL SERVICERS
To the extent so specified in the related Prospectus Supplement, one or
more Special Servicers may be a party to the related Pooling and Servicing
Agreement or may be appointed by the Master Servicer or another specified
party. A Special Servicer for any series of Certificates may be an affiliate of
the Depositor or the Master Servicer and may hold, or be affiliated with the
holder of, Subordinate Certificates of such series. A Special Servicer may be
entitled to any of the rights, and subject to any of the obligations, described
herein in respect of a Master Servicer. In general, a Special Servicer's duties
will relate to defaulted Mortgage Loans, including instituting foreclosures and
negotiating work-outs. The related Prospectus Supplement will describe the
rights, obligations and compensation of any Special Servicer for a particular
series of Certificates. The Master Servicer will be liable for the performance
of a Special Servicer only if, and to the extent, set forth in the related
Prospectus Supplement. In certain cases the Master Servicer may be appointed
the Special Servicer.
CERTIFICATE ACCOUNT
General. The Master Servicer, the Trustee and/or a Special Servicer will,
as to each Trust Fund that includes Mortgage Loans, establish and maintain or
cause to be established and maintained the corresponding Certificate Account,
which will be established so as to comply with the standards of each Rating
Agency that has rated any one or more classes of Certificates of the related
series. A Certificate Account may be maintained as an interest-bearing or a
non-interest-bearing account and the funds held therein may be invested pending
each succeeding Distribution Date in United States government securities and
other obligations that are acceptable to each Rating Agency that has rated any
one or more classes of Certificates of the related series ("Permitted
Investments"). Unless otherwise provided in the related Prospectus Supplement,
any interest or other income earned on funds in a Certificate Account will be
paid to the related Master Servicer, Trustee or Special Servicer (if any) as
additional compensation. A Certificate Account may be maintained with the
related Master Servicer, Special Servicer or Mortgage Asset Seller or with a
depository institution that is an affiliate of any of the foregoing or of the
Depositor, provided that it complies with applicable Rating Agency standards.
If permitted by the applicable Rating Agency or Agencies, a Certificate Account
may contain funds relating to more than one series of mortgage pass-through
certificates and may contain other funds representing payments on mortgage
loans owned by the related Master Servicer or Special Servicer (if any) or
serviced by either on behalf of others.
Deposits. Unless otherwise provided in the related Pooling and Servicing
Agreement and described in the related Prospectus Supplement, the following
payments and collections received or made by the Master Servicer, the Trustee
or any Special Servicer subsequent to the Cut-off Date (other than payments due
on or before the Cut-off Date) are to be deposited in the Certificate Account
for each Trust Fund that includes Mortgage Loans, within a certain period
following receipt (in the case of collections on or in respect of the Mortgage
Loans) or otherwise as provided in the related Pooling and Servicing Agreement:
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(i) all payments on account of principal, including principal
prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans, including
any default interest collected, in each case net of any portion thereof
retained by the Master Servicer or any Special Servicer as its servicing
compensation or as compensation to the Trustee;
(iii) all proceeds received under any hazard, title or other insurance
policy that provides coverage with respect to a Mortgaged Property or the
related Mortgage Loan (other than proceeds applied to the restoration of
the property or released to the related borrower) (collectively, "Insurance
Proceeds"), all proceeds received in connection with the condemnation or
other governmental taking of all or any portion of a Mortgaged Property
(other than proceeds applied to the restoration of the property or released
to the related borrower) (collectively, "Condemnation Proceeds"), and all
other amounts received and retained in connection with the liquidation of
defaulted Mortgage Loans or property acquired in respect thereof, by
foreclosure or otherwise (such amounts, together with those amounts listed
in clause (vii) below, "Liquidation Proceeds"), together with the net
operating income (less reasonable reserves for future expenses) derived
from the operation of any Mortgaged Properties acquired by the Trust Fund
through foreclosure or otherwise;
(iv) any amounts paid under any instrument or drawn from any fund that
constitutes Credit Support for the related series of Certificates;
(v) any advances made with respect to delinquent scheduled payments of
principal and interest on the Mortgage Loans;
(vi) any amounts paid under any Cash Flow Agreement;
(vii) all proceeds of the purchase of any Mortgage Loan, or property
acquired in respect thereof, by the Depositor, any Mortgage Asset Seller or
any other specified person as described under "--Assignment of Mortgage
Loans; Repurchases" and "--Representations and Warranties; Repurchases",
all proceeds of the purchase of any defaulted Mortgage Loan as described
under "--Realization Upon Defaulted Mortgage Loans", and all proceeds of
any Mortgage Asset purchased as described under "Description of the
Certificates--Termination; Retirement of Certificates";
(viii) to the extent that any such item does not constitute additional
servicing compensation to the Master Servicer or a Special Servicer and is
not otherwise retained by the Depositor or another specified person, any
payments on account of modification or assumption fees, late payment
charges, Prepayment Premiums or Equity Participations with respect to the
Mortgage Loans;
(ix) all payments required to be deposited in the Certificate Account
with respect to any deductible clause in any blanket insurance policy
described under "--Hazard Insurance Policies";
(x) any amount required to be deposited by the Master Servicer or the
Trustee in connection with losses realized on investments for the benefit
of the Master Servicer or the Trustee, as the case may be, of funds held in
the Certificate Account; and
(xi) any other amounts required to be deposited in the Certificate
Account as provided in the related Pooling and Servicing Agreement and
described in the related Prospectus Supplement.
Withdrawals. Unless otherwise provided in the related Pooling and
Servicing Agreement and described in the related Prospectus Supplement, a
Master Servicer, Trustee or Special Servicer may make withdrawals from the
Certificate Account for each Trust Fund that includes Mortgage Loans for any of
the following purposes:
(i) to make distributions to the Certificateholders on each Distribution
Date;
(ii) to pay the Master Servicer or a Special Servicer any servicing fees
not previously retained thereby, such payment to be made out of payments
and other collections of interest on the particular Mortgage Loans as to
which such fees were earned;
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(iii) to reimburse the Master Servicer, a Special Servicer or any other
specified person for unreimbursed advances of delinquent scheduled payments
of principal and interest made by it, and certain unreimbursed servicing
expenses incurred by it, with respect to Mortgage Loans in the Trust Fund
and properties acquired in respect thereof, such reimbursement to be made
out of amounts that represent late payments collected on the particular
Mortgage Loans, Liquidation Proceeds, Condemnation Proceeds and Insurance
Proceeds collected on the particular Mortgage Loans and properties, and net
income collected on the particular properties, with respect to which such
advances were made or such expenses were incurred or out of amounts drawn
under any form of Credit Support with respect to such Mortgage Loans and
properties, or if in the judgment of the Master Servicer, the Special
Servicer or such other person, as applicable, such advances and/or expenses
will not be recoverable from such amounts, such reimbursement to be made
from amounts collected on other Mortgage Loans in the same Trust Fund or,
if and to the extent so provided by the related Pooling and Servicing
Agreement and described in the related Prospectus Supplement, only from
that portion of amounts collected on such other Mortgage Loans that is
otherwise distributable on one or more classes of Subordinate Certificates
of the related series;
(iv) if and to the extent described in the related Prospectus Supplement,
to pay the Master Servicer, a Special Servicer or any other specified
person interest accrued on the advances and servicing expenses described in
clause (iii) above incurred by it while such remain outstanding and
unreimbursed;
(v) to pay for costs and expenses incurred by the Trust Fund for
environmental site assessments performed with respect to Mortgaged
Properties that constitute security for defaulted Mortgage Loans, and for
any containment, clean-up or remediation of hazardous wastes and materials
present on such Mortgaged Properties, as described under "--Realization
Upon Defaulted Mortgage Loans";
(vi) to reimburse the Master Servicer, the Depositor, the Trustee, or any
of their respective directors, officers, employees and agents, as the case
may be, for certain expenses, costs and liabilities incurred thereby, as
and to the extent described under "--Certain Matters Regarding the Master
Servicer and the Depositor" and "--Certain Matters Regarding the Trustee";
(vii) if and to the extent described in the related Prospectus
Supplement, to pay the fees of the Trustee and any provider of Credit
Support;
(viii) if and to the extent described in the related Prospectus
Supplement, to reimburse prior draws on any form of Credit Support;
(ix) to pay the Master Servicer, a Special Servicer or the Trustee, as
appropriate, interest and investment income earned in respect of amounts
held in the Certificate Account as additional compensation;
(x) to pay any servicing expenses not otherwise required to be advanced
by the Master Servicer, a Special Servicer or any other specified person;
(xi) if one or more elections have been made to treat the Trust Fund or
designated portions thereof as a REMIC, to pay any federal, state or local
taxes imposed on the Trust Fund or its assets or transactions, as and to
the extent described under "Certain Federal Income Tax Consequences--
REMICs--Prohibited Transactions Tax and Other Taxes";
(xii) to pay for the cost of various opinions of counsel obtained
pursuant to the related Pooling and Servicing Agreement for the benefit of
Certificateholders;
(xiii) to make any other withdrawals permitted by the related Pooling and
Servicing Agreement and described in the related Prospectus Supplement; and
(xiv) to clear and terminate the Certificate Account upon the
termination of the Trust Fund.
REALIZATION UPON DEFAULTED MORTGAGE LOANS
If a default on a Mortgage Loan has occurred or, in the Master Servicer's
judgment, a payment default is imminent, the Master Servicer, on behalf of the
Trustee, may at any time institute foreclosure
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proceedings, exercise any power of sale contained in the related Mortgage,
obtain a deed in lieu of foreclosure, or otherwise acquire title to the related
Mortgaged Property, by operation of law or otherwise. Unless otherwise
specified in the related Prospectus Supplement, the Master Servicer may not,
however, acquire title to any Mortgaged Property, have a receiver of rents
appointed with respect to any Mortgaged Property or take any other action with
respect to any Mortgaged Property that would cause the Trustee, for the benefit
of the related series of Certificateholders, or any other specified person to
be considered to hold title to, to be a "mortgagee-in-possession" of, or to be
an "owner" or an "operator" of such Mortgaged Property within the meaning of
certain federal environmental laws, unless the Master Servicer has previously
received a report prepared by a person who regularly conducts environmental
audits (which report will be an expense of the Trust Fund) and either:
(i) such report indicates that (a) the Mortgaged Property is in
compliance with applicable environmental laws and regulations and (b) there
are no circumstances or conditions present at the Mortgaged Property that
have resulted in any contamination for which investigation, testing,
monitoring, containment, clean-up or remediation could be required under
any applicable environmental laws and regulations; or
(ii) the Master Servicer, based solely (as to environmental matters and
related costs) on the information set forth in such report, determines that
taking such actions as are necessary to bring the Mortgaged Property into
compliance with applicable environmental laws and regulations and/or taking
the actions contemplated by clause (i)(b) above, is reasonably likely to
produce a greater recovery, taking into account the time value of money,
than not taking such actions. See "Certain Legal Aspects of Mortgage
Loans--Environmental Considerations".
A Pooling and Servicing Agreement may grant to the Master Servicer, a
Special Servicer, a provider of Credit Support and/or the holder or holders of
certain classes of the related series of Certificates a right of first refusal
to purchase from the Trust Fund, at a predetermined purchase price (which, if
insufficient to fully fund the entitlements of Certificateholders to principal
and interest thereon, will be specified in the related Prospectus Supplement),
any Mortgage Loan as to which a specified number of scheduled payments are
delinquent. In addition, unless otherwise specified in the related Prospectus
Supplement, the Master Servicer may offer to sell any defaulted Mortgage Loan
if and when the Master Servicer determines, consistent with its normal
servicing procedures, that such a sale would produce a greater recovery, taking
into account the time value of money, than would liquidation of the related
Mortgaged Property. In the absence of any such sale, the Master Servicer will
generally be required to proceed against the related Mortgaged Property,
subject to the discussion below.
Unless otherwise provided in the related Prospectus Supplement, if title
to any Mortgaged Property is acquired by a Trust Fund as to which a REMIC
election has been made, the Master Servicer, on behalf of the Trust Fund, will
be required to sell the Mortgaged Property within three full years after the
taxable year of acquisition, unless (i) the Internal Revenue Service (the
"IRS") grants an extension of time to sell such property or (ii) the Trustee
receives an opinion of independent counsel to the effect that the holding of
the property by the Trust Fund for longer than such period will not result in
the imposition of a tax on the Trust Fund or cause the Trust Fund (or any
designated portion thereof) to fail to qualify as a REMIC under the Code at any
time that any Certificate is outstanding. Subject to the foregoing and any
other tax-related limitations, the Master Servicer will generally be required
to attempt to sell any Mortgaged Property so acquired on the same terms and
conditions it would if it were the owner. Unless otherwise provided in the
related Prospectus Supplement, if title to any Mortgaged Property is acquired
by a Trust Fund as to which a REMIC election has been made, the Master Servicer
will also be required to ensure that the Mortgaged Property is administered so
that it constitutes "foreclosure property" within the meaning of Code Section
860G(a)(8) at all times, that the sale of such property does not result in the
receipt by the Trust Fund of any income from non-permitted assets as described
in Code Section 860F(a)(2)(B), and that the Trust Fund does not derive any "net
income from foreclosure property" within the meaning of Code Section
860G(c)(2), with respect to such property. If the Trust Fund acquires title to
any Mortgaged Property, the Master Servicer, on behalf of the Trust Fund, may
retain an independent contractor to manage and operate such property. The
retention of an independent contractor, however, will not relieve the Master
Servicer of its obligation to manage such Mortgaged Property as required under
the related Pooling and Servicing Agreement.
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If Liquidation Proceeds collected with respect to a defaulted Mortgage
Loan are less than the outstanding principal balance of the defaulted Mortgage
Loan plus interest accrued thereon plus the aggregate amount of reimbursable
expenses incurred by the Master Servicer in connection with such Mortgage Loan,
then, to the extent that such shortfall is not covered by any instrument or
fund constituting Credit Support, the Trust Fund will realize a loss in the
amount of such shortfall. The Master Servicer will be entitled to reimbursement
out of the Liquidation Proceeds recovered on any defaulted Mortgage Loan, prior
to the distribution of such Liquidation Proceeds to Certificateholders, amounts
that represent unpaid servicing compensation in respect of the Mortgage Loan,
unreimbursed servicing expenses incurred with respect to the Mortgage Loan and
any unreimbursed advances of delinquent payments made with respect to the
Mortgage Loan. In addition, if and to the extent set forth in the related
Prospectus Supplement, amounts otherwise distributable on the Certificates may
be further reduced by interest payable to the Master Servicer on such servicing
expenses and advances.
If any Mortgaged Property suffers damage such that the proceeds, if any,
of the related hazard insurance policy are insufficient to restore fully the
damaged property, the Master Servicer will not be required to expend its own
funds to effect such restoration unless (and to the extent not otherwise
provided in the related Prospectus Supplement) it determines (i) that such
restoration will increase the proceeds to Certificateholders on liquidation of
the Mortgage Loan after reimbursement of the Master Servicer for its expenses
and (ii) that such expenses will be recoverable by it from related Insurance
Proceeds, Condemnation Proceeds, Liquidation Proceeds and/or amounts drawn on
any instrument or fund constituting Credit Support.
HAZARD INSURANCE POLICIES
Unless otherwise specified in the related Prospectus Supplement, each
Pooling and Servicing Agreement will require the Master Servicer to use
reasonable efforts to cause each Mortgage Loan borrower to maintain a hazard
insurance policy that provides for such coverage as is required under the
related Mortgage or, if the Mortgage permits the holder thereof to dictate to
the borrower the insurance coverage to be maintained on the related Mortgaged
Property, such coverage as is consistent with the Master Servicer's normal
servicing procedures. Unless otherwise specified in the related Prospectus
Supplement, such coverage generally will be in an amount equal to the lesser of
the principal balance owing on such Mortgage Loan and the replacement cost of
the related Mortgaged Property. The ability of a Master Servicer to assure that
hazard insurance proceeds are appropriately applied may be dependent upon its
being named as an additional insured under any hazard insurance policy and
under any other insurance policy referred to below, or upon the extent to which
information concerning covered losses is furnished by borrowers. All amounts
collected by a Master Servicer under any such policy (except for amounts to be
applied to the restoration or repair of the Mortgaged Property or released to
the borrower in accordance with the Master Servicer's normal servicing
procedures and/or to the terms and conditions of the related Mortgage and
Mortgage Note) will be deposited in the related Certificate Account. The
Pooling and Servicing Agreement may provide that the Master Servicer may
satisfy its obligation to cause each borrower to maintain such a hazard
insurance policy by maintaining a blanket policy insuring against hazard losses
on all of the Mortgage Loans in a Trust Fund. If such blanket policy contains a
deductible clause, the Master Servicer will be required, in the event of a
casualty covered by such blanket policy, to deposit in the related Certificate
Account all additional sums that would have been deposited therein under an
individual policy but were not because of such deductible clause.
In general, the standard form of fire and extended coverage policy covers
physical damage to or destruction of the improvements of the property by fire,
lightning, explosion, smoke, windstorm and hail, and riot, strike and civil
commotion, subject to the conditions and exclusions specified in each policy.
Although the policies covering the Mortgaged Properties will be underwritten by
different insurers under different state laws in accordance with different
applicable state forms, and therefore will not contain identical terms and
conditions, most such policies typically do not cover any physical damage
resulting from war, revolution, governmental actions, floods and other
water-related causes, earth movement (including earthquakes, landslides and
mudflows), wet or dry rot, vermin and domestic animals. Accordingly, a
Mortgaged Property may not be insured for losses arising from any such cause
unless the related Mortgage specifically requires, or permits the holder
thereof to require, such coverage.
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The hazard insurance policies covering the Mortgaged Properties will
typically contain co-insurance clauses that in effect require an insured at all
times to carry insurance of a specified percentage (generally 80% to 90%) of
the full replacement value of the improvements on the property in order to
recover the full amount of any partial loss. If the insured's coverage falls
below this specified percentage, such clauses generally provide that the
insurer's liability in the event of partial loss does not exceed the lesser of
(i) the replacement cost of the improvements less physical depreciation and
(ii) such proportion of the loss as the amount of insurance carried bears to
the specified percentage of the full replacement cost of such improvements.
DUE-ON-SALE AND DUE-ON-ENCUMBRANCE PROVISIONS
Certain of the Mortgage Loans may contain a due-on-sale clause that
entitles the lender to accelerate payment of the Mortgage Loan upon any sale or
other transfer of the related Mortgaged Property made without the lender's
consent. Certain of the Mortgage Loans may also contain a due-on-encumbrance
clause that entitles the lender to accelerate the maturity of the Mortgage Loan
upon the creation of any other lien or encumbrance upon the Mortgaged Property.
Unless otherwise provided in the related Prospectus Supplement, the Master
Servicer will determine whether to exercise any right the Trustee may have
under any such provision in a manner consistent with the Master Servicer's
normal servicing procedures. Unless otherwise specified in the related
Prospectus Supplement, the Master Servicer will be entitled to retain as
additional servicing compensation any fee collected in connection with the
permitted transfer of a Mortgaged Property. See "Certain Legal Aspects of
Mortgage Loans--Due-on-Sale and Due-on-Encumbrance".
SERVICING COMPENSATION AND PAYMENT OF EXPENSES
Unless otherwise specified in the related Prospectus Supplement, a Master
Servicer's primary servicing compensation with respect to a series of
Certificates will come from the periodic payment to it of a specified portion
of the interest payments on each Mortgage Loan in the related Trust Fund.
Because such compensation is generally based on a percentage of the principal
balance of each such Mortgage Loan outstanding from time to time, it will
decrease in accordance with the amortization of the Mortgage Loans. If and to
the extent described in the related Prospectus Supplement, a Master Servicer's
compensation may also include: (i) an additional specified portion of the
interest payments on each defaulted Mortgage Loan serviced by the Master
Servicer; (ii) subject to any specified limitations, a fixed percentage of some
or all of the collections and proceeds received with respect to any defaulted
Mortgage Loan as to which it negotiated a work-out or that it liquidated; and
(iii) any other amounts specified in the related Prospectus Supplement. Unless
otherwise specified in the related Prospectus Supplement, the Master Servicer
may retain, as additional compensation, all or a portion of late payment
charges, Prepayment Premiums, modification fees and other fees collected from
borrowers and any interest or other income that may be earned on funds held in
the Certificate Account. Any Sub-Servicer will receive a portion of the Master
Servicer's compensation as its sub-servicing compensation.
In addition to amounts payable to any Sub-Servicer, a Master Servicer may
be required, to the extent provided in the related Prospectus Supplement, to
pay from amounts that represent its servicing compensation certain expenses
incurred in connection with the administration of the related Trust Fund,
including, without limitation, payment of the fees and disbursements of
independent accountants, payment of fees and disbursements of the Trustee and
any custodians appointed thereby and payment of expenses incurred in connection
with distributions and reports to Certificateholders. Certain other expenses,
including certain expenses related to Mortgage Loan defaults and liquidations
and, to the extent so provided in the related Prospectus Supplement, interest
on such expenses at the rate specified therein, and the fees of any Special
Servicer, may be required to be borne by the Trust Fund.
EVIDENCE AS TO COMPLIANCE
Each Pooling and Servicing Agreement will provide that on or before a
specified date in each year, beginning the first such date that is at least a
specified number of months after the Cut-off Date, a firm of independent public
accountants will furnish a statement to the related Trustee to the effect that,
on the
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basis of an examination by such firm conducted substantially in compliance with
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 or the Audit Program for Mortgages
serviced for FHLMC, the servicing of mortgage loans under agreements (including
the related Pooling and Servicing Agreement) substantially similar to each
other was conducted in compliance with such agreements except for such
significant exceptions or errors in records that, in the opinion of the firm,
the Uniform Single Audit Program for Mortgage Bankers or the Audit Program for
Mortgages serviced for FHLMC requires it to report. In rendering its statement
such firm may rely, as to the matters relating to the direct servicing of
mortgage loans by Sub-Servicers, upon comparable statements for examinations
conducted substantially in compliance with the Uniform Single Audit Program for
Mortgage Bankers or the Audit Program for Mortgages serviced for FHLMC
(rendered within one year of such statement) of firms of independent public
accountants with respect to those Subservicers which also have been the subject
of such an examination.
Each Pooling and Servicing Agreement will also provide that, on or before
a specified date in each year, beginning the first such date that is at least a
specified number of months after the Cut-off Date, there is to be delivered to
the related Trustee an annual statement signed by one or more officers of the
Master Servicer to the effect that, to the best knowledge of each such officer,
the Master Servicer has fulfilled in all material respects its obligations
under the Pooling and Servicing Agreement throughout the preceding year or, if
there has been a material default in the fulfillment of any such obligation,
such statement shall specify each such known default and the nature and status
thereof. Such statement may be provided as a single form making the required
statements as to more than one Pooling and Servicing Agreement.
Unless otherwise specified in the related Prospectus Supplement, copies of
the annual accountants' statement and the annual statement of officers of a
Master Servicer may be obtained by Certificateholders upon written request to
the Trustee.
CERTAIN MATTERS REGARDING THE MASTER SERVICER AND THE DEPOSITOR
The entity servicing as Master Servicer under a Pooling and Servicing
Agreement may be an affiliate of the Depositor and may have other normal
business relationships with the Depositor or the Depositor's affiliates. Unless
otherwise specified in the related Prospectus Supplement, the Pooling and
Servicing Agreement for a series of Certificates will provide that the Master
Servicer may not resign from its obligations and duties thereunder except upon
a determination that performance of such duties is no longer permissible under
applicable law or except in connection with a permitted transfer of servicing.
No such resignation will become effective until the Trustee or a successor
servicer has assumed the Master Servicer's obligations and duties under the
Pooling and Servicing Agreement.
Unless otherwise specified in the related Prospectus Supplement, each
Pooling and Servicing Agreement will also provide that, except as set forth
below, neither the Master Servicer, the Depositor, nor any director, officer,
employee or agent of the Master Servicer or the Depositor will 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 the
Pooling and Servicing Agreement, or for errors in judgment; provided, however,
that neither the Master Servicer, the Depositor, nor any such person will be
protected against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or negligence in the performance of duties or by
reason of reckless disregard of obligations and duties thereunder. Unless
otherwise specified in the related Prospectus Supplement, each Pooling and
Servicing Agreement will further provide that the Master Servicer, the
Depositor, and any director, officer, employee or agent of the Master Servicer
or the Depositor is entitled to indemnification by the Trust Fund and will be
held harmless against any loss, liability or expense incurred in connection
with any legal action relating to the Pooling and Servicing Agreement or the
related series of Certificates, other than any loss, liability or expense
related to any specific Mortgage Loan or Mortgage Loans (except any such loss,
liability or expense otherwise reimbursable pursuant to the Pooling and
Servicing Agreement) and any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or negligence in the performance of duties
thereunder or by reason of reckless disregard of obligations and duties
thereunder.
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In addition, each Pooling and Servicing Agreement will provide that neither the
Master Servicer nor the Depositor will be under any obligation to appear in,
prosecute or defend any legal or administrative action that is not incidental
to its respective duties under the Pooling and Servicing Agreement and which in
its opinion may involve it in any expense or liability. The Master Servicer or
the Depositor may, however, in its discretion undertake any such action which
it may deem necessary or desirable with respect to the Pooling and Servicing
Agreement and the rights and duties of the parties thereto and the interests of
the Certificateholders thereunder. In such event, the legal expenses and costs
of such action and any liability resulting therefrom will be expenses, costs
and liabilities of the Trust Fund, and the Master Servicer or the Depositor, as
the case may be, will be entitled to be reimbursed therefor out of funds
otherwise distributable to Certificateholders.
Any person into which the Master Servicer may be merged or consolidated,
any person resulting from any merger or consolidation to which the Master
Servicer is a party or any person succeeding to the business of the Master
Servicer will be the successor of the Master Servicer under the Pooling and
Servicing Agreement, provided that, unless otherwise specified in the related
Prospectus Supplement, (i) such person is qualified to service mortgage loans
on behalf of FNMA or FHLMC and (ii) such merger, consolidation or succession
does not adversely affect the then-current ratings of the classes of
Certificates of the related series that have been rated. In addition,
notwithstanding the prohibition on its resignation, the Master Servicer may
assign its rights under a Pooling and Servicing Agreement to any person to whom
the Master Servicer is transferring a substantial portion of its mortgage
servicing portfolio, provided clauses (i) and (ii) above are satisfied. In the
case of any such assignment, the Master Servicer will be released from its
obligations under such Pooling and Servicing Agreement, other than liabilities
and obligations incurred by it prior to the time of such assignment.
EVENTS OF DEFAULT
Events of Default under the Pooling and Servicing Agreement in respect of
a series of Certificates, unless otherwise specified in the Prospectus
Supplement, will include, without limitation, (i) any failure by the Master
Servicer to make a required deposit to the Certificate Account or, if the
Master Servicer is so required, to distribute to the holders of any class of
Certificates of such series any required payment which continues unremedied for
5 days after the giving of written notice of such failure to the Master
Servicer by the Trustee or the Depositor, or to the Master Servicer, the
Depositor and the Trustee by the holders of Certificates of such class
evidencing not less than 25% of the aggregate Percentage Interests constituting
such class; (ii) any failure by the Master Servicer duly to observe or perform
in any material respect any other of its covenants or agreements in the Pooling
and Servicing Agreement with respect to such series of Certificates which
continues unremedied for 30 days after the giving of written notice of such
failure to the Master Servicer by the Trustee or the Depositor, or to the
Master Servicer, the Depositor and the Trustee by the holders of any class of
Certificates of such series evidencing not less than 25% of the aggregate
Percentage Interests constituting such class; and (iii) certain events of
insolvency, readjustment of debt, marshalling of assets and liabilities or
similar proceedings regarding the Master Servicer and certain actions by the
Master Servicer indicating its insolvency or inability to pay its obligations.
Material variations to the foregoing Events of Default (other than to add
thereto or to make them more restrictive) will be specified in the related
Prospectus Supplement. A default pursuant to the terms of any MBS included in
any Trust Fund will not constitute an Event of Default under the related
Pooling and Servicing Agreement.
RIGHTS UPON EVENT OF DEFAULT
So long as an Event of Default remains unremedied, either the Depositor or
the Trustee may, and at the direction of the holders of Certificates evidencing
not less than 51% of the aggregate undivided interests (or, if so specified in
the related Prospectus Supplement, voting rights) in the related Trust Fund the
Trustee shall, by written notification to the Master Servicer and to the
Depositor or the Trustee, as applicable, terminate all of the rights and
obligations of the Master Servicer under the Pooling and Servicing Agreement
covering such Trust Fund and in and to the related Mortgage Loans and the
proceeds thereof (other than any rights of the Master Servicer as
Certificateholder and other than any
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rights of the Master Servicer to payment and/or reimbursement for previously
earned servicing fees and outstanding advances), whereupon the Trustee or, upon
notice to the Depositor and with the Depositor's consent, its designee will
succeed to all responsibilities, duties and liabilities of the Master Servicer
under such Pooling and Servicing Agreement (other than the obligation to
purchase Mortgage Loans under certain circumstances) and will be entitled to
similar compensation arrangements. In the event that the Trustee would be
obligated to succeed the Master Servicer but is unwilling so to act, it may
appoint (or if it is unable so to act, it shall appoint) or petition a court of
competent jurisdiction for the appointment of, a FNMA- or FHLMC-approved
mortgage servicing institution with a net worth of at least $10,000,000 to act
as successor to the Master Servicer under the Pooling and Servicing Agreement
(unless otherwise set forth in the Pooling and Servicing Agreement). Pending
such appointment, the Trustee is obligated to act in such capacity. The Trustee
and such successor may agree upon the servicing compensation to be paid, which
in no event may be greater than the compensation to the initial Master Servicer
under the Pooling and Servicing Agreement.
No Certificateholder will have any right under a Pooling and Servicing
Agreement to institute any proceeding with respect to such Pooling and
Servicing Agreement unless such holder previously has given to the Trustee
written notice of default and the continuance thereof and unless the holders of
Certificates of any class evidencing not less than 25% of the aggregate
Percentage Interests constituting such class have made written request upon the
Trustee to institute such proceeding in its own name as Trustee thereunder and
have offered to the Trustee reasonable indemnity and the Trustee for 60 days
after receipt of such request and indemnity has neglected or refused to
institute any such proceeding. However, the Trustee will be under no obligation
to exercise any of the trusts or powers vested in it by the Pooling and
Servicing Agreement or to institute, conduct or defend any litigation
thereunder or in relation thereto at the request, order or direction of any of
the holders of Certificates covered by such Pooling and Servicing Agreement,
unless such Certificateholders have offered to the Trustee reasonable security
or indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby.
AMENDMENT
Each Pooling and Servicing Agreement may be amended by the parties
thereto, without the consent of any of the holders of Certificates covered by
such Pooling and Servicing Agreement, (i) to cure any ambiguity, (ii) to
correct or supplement any provision therein which may be inconsistent with any
other provision therein or to correct any error, (iii) to change the timing
and/or nature of deposits in the Certificate Account, provided that (A) such
change would not adversely affect in any material respect the interests of any
Certificateholder, as evidenced by an opinion of counsel, and (B) such change
would not adversely affect the then-current rating of any rated classes of
Certificates, as evidenced by a letter from each applicable Rating Agency, (iv)
if a REMIC election has been made with respect to the related Trust Fund, to
modify, eliminate or add to any of its provisions (A) to such extent as shall
be necessary or desirable to maintain the qualification of the Trust Fund as a
REMIC or to avoid or minimize the risk of imposition of any tax on the related
Trust Fund, provided that the Trustee has received an opinion of counsel to the
effect that (1) such action is necessary or desirable to maintain such
qualification or to avoid or minimize such risk, and (2) such action will not
adversely affect in any material respect the interests of any holder of
Certificates covered by the Pooling and Servicing Agreement, or (C) to restrict
the transfer of the REMIC Residual Certificates, provided that the Depositor
has determined that the then-current ratings of the classes of the Certificates
that have been rated will not be adversely affected, as evidenced by a letter
from each applicable Rating Agency, and that any such amendment will not give
rise to any tax with respect to the transfer of the REMIC Residual Certificates
to a non-Permitted Transferee, (v) to make any other provisions with respect to
matters or questions arising under such Pooling and Servicing Agreement or any
other change, provided that such action will not adversely affect in any
material respect the interests of any Certificateholder, or (vi) to amend
specified provisions that are not material to holders of any class of
Certificates offered hereunder.
Unless otherwise specified in the Prospectus Supplement, the Pooling and
Servicing Agreement may also be amended by the parties thereto with the consent
of the holders of Certificates of each class affected thereby evidencing, in
each case, not less than 66% of the aggregate Percentage Interests constituting
such class for the purpose of adding any provisions to or changing in any
manner or
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eliminating any of the provisions of such Pooling and Servicing Agreement or of
modifying in any manner the rights of the holders of Certificates covered by
such Pooling and Servicing Agreement, except that no such amendment may (i)
reduce in any manner the amount of, or delay the timing of, payments received
on Mortgage Loans which are required to be distributed on a Certificate of any
class 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 without the consent of the holders of
all Certificates of such class covered by such Pooling and Servicing Agreement
then outstanding.
Notwithstanding the foregoing, if a REMIC election has been made with
respect to the related Trust Fund, the Trustee will not be required to consent
to any amendment to a Pooling and Servicing Agreement without having first
received an opinion of counsel to the effect that such amendment or the
exercise of any power granted to the Master 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 the related Trust Fund or cause such
Trust Fund to fail to qualify as a REMIC.
THE TRUSTEE
The Trustee under each Pooling and Servicing Agreement will be named in
the related Prospectus Supplement. The commercial bank, national banking
association, banking corporation or trust company that serves as Trustee may
have typical banking relationships with the Depositor and its affiliates.
DUTIES OF THE TRUSTEE
The Trustee for each series of Certificates will make no representation as
to the validity or sufficiency of the related Pooling and Servicing Agreement,
the Certificates or any underlying Mortgage Asset or related document and will
not be accountable for the use or application by or on behalf of any Master
Servicer or Special Servicer of any funds paid to the Master Servicer or
Special Servicer in respect of the Certificates or the underlying Mortgage
Assets. If no Event of Default has occurred and is continuing, the Trustee for
each series of Certificates will be required to perform only those duties
specifically required under the related Pooling and Servicing Agreement.
However, upon receipt of any of the various certificates, reports or other
instruments required to be furnished to it pursuant to the related Pooling and
Servicing Agreement, a Trustee will be required to examine such documents and
to determine whether they conform to the requirements of such agreement.
CERTAIN MATTERS REGARDING THE TRUSTEE
As and to the extent described in the related Prospectus Supplement, the
fees and normal disbursements of any Trustee may be the expense of the related
Master Servicer or other specified person or may be required to be borne by the
related Trust Fund.
Unless otherwise specified in the related Prospectus Supplement, the
Trustee for each series of Certificates will be entitled to indemnification,
from amounts held in the Certificate Account for such series, for any loss,
liability or expense incurred by the Trustee in connection with the Trustee's
acceptance or administration of its trusts under the related Pooling and
Servicing Agreement; provided, however, that such indemnification will not
extend to any loss liability or expense incurred by reason of willful
misfeasance, bad faith or negligence on the part of the Trustee in the
performance of its obligations and duties thereunder, or by reason of its
reckless disregard of such obligations or duties.
Unless otherwise specified in the related Prospectus Supplement, the
Trustee for each series of Certificates will be entitled to execute any of its
trusts or powers under the related Pooling and Servicing Agreement or perform
any of this duties thereunder either directly or by or through agents or
attorneys.
RESIGNATION AND REMOVAL OF THE TRUSTEE
The Trustee may resign at any time, in which event the Depositor will be
obligated to appoint a successor Trustee. The Depositor may also remove the
Trustee if the Trustee ceases to be eligible to continue as such under the
Pooling and Servicing Agreement or if the Trustee becomes insolvent. Upon
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becoming aware of such circumstances, the Depositor will be obligated to
appoint a successor Trustee. The Trustee may also be removed at any time by the
holders of Certificates evidencing not less than 51% of the aggregate undivided
interests (or, if so specified in the related Prospectus Supplement, voting
rights) in the related Trust Fund. Any resignation or removal of the Trustee
and appointment of a successor Trustee will not become effective until
acceptance of the appointment by the successor Trustee.
DESCRIPTION OF CREDIT SUPPORT
GENERAL
Credit Support may be provided with respect to one or more classes of the
Certificates of any series, or with respect to the related Mortgage Assets.
Credit Support may be in the form of a letter of credit, the subordination of
one or more classes of Certificates, the use of a pool insurance policy or
guarantee insurance, the establishment of one or more reserve funds or another
method of Credit Support described in the related Prospectus Supplement, or any
combination of the foregoing. If and to the extent so provided in the related
Prospectus Supplement, any of the foregoing forms of Credit Support may provide
credit enhancement for more than one series of Certificates.
Unless otherwise provided in the related Prospectus Supplement for a
series of Certificates, the Credit Support will not provide protection against
all risks of loss and will not guarantee payment to Certificateholders of all
amounts to which they are entitled under the related Pooling and Servicing
Agreement. If losses or shortfalls occur that exceed the amount covered by the
related Credit Support or that are of a type not covered by such Credit
Support, Certificateholders will bear their allocable share of deficiencies.
Moreover, if a form of Credit Support covers the Offered Certificates of more
than one series and losses on the related Mortgage Assets exceed the amount of
such Credit Support, it is possible that the holders of Offered Certificates of
one (or more) such series will be disproportionately benefited by such Credit
Support to the detriment of the holders of Offered Certificates of one (or
more) other such series.
If Credit Support is provided with respect to one or more classes of
Certificates of a series, or with respect to the related Mortgage Assets, the
related Prospectus Supplement will include a description of (i) the nature and
amount of coverage under such Credit Support, (ii) any conditions to payment
thereunder not otherwise described herein, (iii) the conditions (if any) under
which the amount of coverage under such Credit Support may be reduced and under
which such Credit Support may be terminated or replaced and (iv) the material
provisions relating to such Credit Support. Additionally, the related
Prospectus Supplement will set forth certain information with respect to the
obligor, if any, under any instrument of Credit Support. See "Risk
Factors--Credit Support Limitations".
SUBORDINATE CERTIFICATES
If so specified in the related Prospectus Supplement, one or more classes
of Certificates of a series may be Subordinate Certificates. To the extent
specified in the related Prospectus Supplement, the rights of the holders of
Subordinate Certificates to receive distributions from the Certificate Account
on any Distribution Date will be subordinated to the corresponding rights of
the holders of Senior Certificates. If so provided in the related Prospectus
Supplement, the subordination of a class may apply only in the event of certain
types of losses or shortfalls. The related Prospectus Supplement will set forth
information concerning the method and amount of subordination provided by a
class or classes of Subordinate Certificates in a series and the circumstances
under which such subordination will be available.
If the Mortgage Assets in any Trust Fund are divided into separate groups,
each supporting a separate class or classes of Certificates of the related
series, Credit Support may be provided by cross-support provisions requiring
that distributions be made on Senior Certificates evidencing interests in one
group of Mortgage Assets prior to distributions on Subordinate Certificates
evidencing interests in a different group of Mortgage Assets within the Trust
Fund. The Prospectus Supplement for a series that includes a cross-support
provision will describe the manner and conditions for applying such provisions.
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INSURANCE OR GUARANTEES WITH RESPECT TO MORTGAGE LOANS
If so provided in the Prospectus Supplement for a series of Certificates,
Mortgage Loans included in the related Trust Fund will be covered for certain
default risks by insurance policies or guarantees. The related Prospectus
Supplement will describe the nature of such default risks and the extent of
such coverage.
LETTER OF CREDIT
If so provided in the Prospectus Supplement for a series of Certificates,
deficiencies in amounts otherwise payable on such Certificates or certain
classes thereof will be covered by one or more letters of credit, issued by a
bank or other financial institution specified in such Prospectus Supplement
(the "Letter of Credit Bank"). Under a letter of credit, the Letter of Credit
Bank will be obligated to honor draws thereunder in an aggregate fixed dollar
amount, net of unreimbursed payments thereunder, generally equal to a
percentage specified in the related Prospectus Supplement of the aggregate
principal balance of the Mortgage Assets on the related Cut-off Date or of the
initial aggregate Certificate Balance of one or more classes of Certificates.
If so specified in the related Prospectus Supplement, the letter of credit may
permit draws only in the event of certain types of losses and shortfalls. The
amount available under the letter of credit will, in all cases, be reduced to
the extent of the unreimbursed payments thereunder and may otherwise be reduced
as described in the related Prospectus Supplement. The obligations of the
Letter of Credit Bank under the letter of credit for each series of
Certificates will expire at the earlier of the date specified in the related
Prospectus Supplement or the termination of the Trust Fund.
CERTIFICATE INSURANCE AND SURETY BONDS
If so provided in the Prospectus Supplement for a series of Certificates,
deficiencies in amounts otherwise payable on such Certificates or certain
classes thereof will be covered by insurance policies or surety bonds provided
by one or more insurance companies or sureties. Such instruments may cover,
with respect to one or more classes of Certificates of the related series,
timely distributions of interest or distributions of principal on the basis of
a schedule of principal distributions set forth in or determined in the manner
specified in the related Prospectus Supplement. The related Prospectus
Supplement will describe any limitations on the draws that may be made under
any such instrument.
RESERVE FUNDS
If so provided in the Prospectus Supplement for a series of Certificates,
deficiencies in amounts otherwise payable on such Certificates or certain
classes thereof will be covered (to the extent of available funds) by one or
more reserve funds in which cash, a letter of credit, Permitted Investments, a
demand note or a combination thereof will be deposited, in the amounts
specified in such Prospectus Supplement. If so specified in the related
Prospectus Supplement, the reserve fund for a series may also be funded over
time by a specified amount of certain collections received on the related
Mortgage Assets.
Amounts on deposit in any reserve fund for a series will be applied for
the purposes, in the manner, and to the extent specified in the related
Prospectus Supplement. If so specified in the related Prospectus Supplement,
reserve funds may be established to provide protection only against certain
types of losses and shortfalls. Following each Distribution Date, amounts in a
reserve fund in excess of any amount required to be maintained therein may be
released from the reserve fund under the conditions and to the extent specified
in the related Prospectus Supplement.
If so specified in the related Prospectus Supplement, amounts deposited in
any reserve fund will be invested in Permitted Investments. Unless otherwise
specified in the related Prospectus Supplement, any reinvestment income or
other gain from such investments will be credited to the related reserve fund
for such series, and any loss resulting from such investments will be charged
to such reserve fund. However, such income may be payable to any related Master
Servicer or another service provider as additional compensation for its
services. The reserve fund, if any, for a series will not be a part of the
Trust Fund unless otherwise specified in the related Prospectus Supplement.
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CREDIT SUPPORT WITH RESPECT TO MBS
If so provided in the Prospectus Supplement for a series of Certificates,
any MBS included in the related Trust Fund and/or the related underlying
mortgage loans may be covered by one or more of the types of Credit Support
described herein. The related Prospectus Supplement will specify, as to each
such form of Credit Support, the information indicated above with respect
thereto, to the extent such information is material and available.
CERTAIN LEGAL ASPECTS OF MORTGAGE LOANS
The following discussion contains general summaries of certain legal
aspects of loans secured by commercial and multifamily residential properties.
Because such legal aspects are governed by applicable state law (which laws may
differ substantially), the summaries do not purport to be complete, to reflect
the laws of any particular state, or to encompass the laws of all states in
which the security for the Mortgage Loans (or mortgage loans underlying any
MBS) is situated. Accordingly, the summaries are qualified in their entirety by
reference to the applicable laws of those states. See "Description of the Trust
Funds--Mortgage Loans". For purposes of the following discussion, "Mortgage
Loan" includes a mortgage loan underlying an MBS.
GENERAL
Each Mortgage Loan will be evidenced by a note or bond and secured by an
instrument granting a security interest in real property, which may be a
mortgage, deed of trust or a deed to secure debt, depending upon the prevailing
practice and law in the state in which the related Mortgaged Property is
located. Mortgages, deeds of trust and deeds to secure debt are herein
collectively referred to as "mortgages". A mortgage creates a lien upon, or
grants a title interest in, the real property covered thereby, and represents
the security for the repayment of the indebtedness customarily evidenced by a
promissory note. The priority of the lien created or interest granted will
depend on the terms of the mortgage and, in some cases, on the terms of
separate subordination agreements or intercreditor agreements with others that
hold interests in the real property, the knowledge of the parties to the
mortgage and, generally, the order of recordation of the mortgage in the
appropriate public recording office. However, the lien of a recorded mortgage
will generally be subordinate to later-arising liens for real estate taxes and
assessments and other charges imposed under governmental police powers.
TYPES OF MORTGAGE INSTRUMENTS
There are two parties to a mortgage: a mortgagor (the borrower and usually
the owner of the subject property) and a mortgagee (the lender). In contrast, a
deed of trust is a three-party instrument, among a trustor (the equivalent of a
borrower), a trustee to whom the real property is conveyed, and a beneficiary
(the lender) for whose benefit the conveyance is made. Under a deed of trust,
the trustor grants the property, irrevocably until the debt is paid, in trust
and generally with a power of sale, to the trustee to secure repayment of the
indebtedness evidenced by the related note. A deed to secure debt typically has
two parties, pursuant to which the borrower, or grantor, conveys title to the
real property to the grantee, or lender, generally with a power of sale, until
such time as the debt is repaid. In a case where the borrower is a land trust,
there would be an additional party because legal title to the property is held
by a land trustee under a land trust agreement for the benefit of the borrower.
At origination of a mortgage loan involving a land trust, the borrower may
execute a separate undertaking to make payments on the mortgage note. In no
event is the land trustee personally liable for the mortgage note obligation.
The mortgagee's authority under a mortgage, the trustee's authority under a
deed of trust and the grantee's authority under a deed to secure debt are
governed by the express provisions of the related instrument, the law of the
state in which the real property is located, certain federal laws and, in some
deed of trust transactions, the directions of the beneficiary.
LEASES AND RENTS
Mortgages that encumber income-producing property often contain an
assignment of rents and leases and/or may be accompanied by a separate
assignment of rents and leases, pursuant to which the borrower
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assigns to the lender the borrower's right, title and interest as landlord
under each lease and the income derived therefrom, while (unless rents are to
be paid directly to the lender) retaining a revocable license to collect the
rents for so long as there is no default. If the borrower defaults, the license
terminates and the lender is entitled to collect the rents. Local law may
require that the lender take possession of the property and/or obtain a
court-appointed receiver before becoming entitled to collect the rents.
In most states, hotel and motel room rates are considered accounts
receivable under the Uniform Commercial Code ("UCC"); in cases where hotels or
motels constitute loan security, the rates are generally pledged by the
borrower as additional security for the loan. In general, the lender must file
financing statements in order to perfect its security interest in the room
rates and must file continuation statements, generally every five years, to
maintain perfection of such security interest. In certain cases, Mortgage Loans
secured by hotels or motels may be included in a Trust Fund even if the
security interest in the room rates was not perfected or the requisite UCC
filings were allowed to lapse. Even if the lender's security interest in room
rates is perfected under applicable non-bankruptcy law, it will generally be
required to commence a foreclosure action or otherwise take possession of the
property in order to enforce its rights to collect the room rates following a
default. In the bankruptcy setting, however, the lender will be stayed from
enforcing its rights to collect room rates, but those room rates (in light of
certain revisions to the Bankruptcy Code which are effective for all bankruptcy
cases commenced on or after October 22, 1994) constitute "cash collateral" and
therefore cannot be used by the bankruptcy debtor without a hearing or lender's
consent and unless the lender's interest in the room rates is given adequate
protection (e.g., cash payment for otherwise encumbered funds or a replacement
lien on unencumbered property, in either case equal in value to the amount of
room rates that the debtor proposes to use, or other similar relief). See
"--Bankruptcy Laws".
PERSONALTY
In the case of certain types of mortgaged properties, such as hotels,
motels and nursing homes, personal property (to the extent owned by the
borrower and not previously pledged) may constitute a significant portion of
the property's value as security. The creation and enforcement of liens on
personal property are governed by the UCC. Accordingly, if a borrower pledges
personal property as security for a mortgage loan, the lender generally must
file UCC financing statements in order to perfect its security interest
therein, and must file continuation statements, generally every five years, to
maintain that perfection. In certain cases, Mortgage Loans secured in part by
personal property may be included in a Trust Fund even if the security interest
in such personal property was not perfected or the requisite UCC filings were
allowed to lapse.
FORECLOSURE
General. Foreclosure is a legal procedure that allows the lender to
recover its mortgage debt by enforcing its rights and available legal remedies
under the mortgage. If the borrower defaults in payment or performance of its
obligations under the note or mortgage, the lender has the right to institute
foreclosure proceedings to sell the real property at public auction to satisfy
the indebtedness.
Foreclosure procedures vary from state to state. Two primary methods of
foreclosing a mortgage are judicial foreclosure, involving court proceedings,
and non-judicial foreclosure pursuant to a power of sale granted in the
mortgage instrument. Other foreclosure procedures are available in some states,
but they are either infrequently used or available only in limited
circumstances.
A foreclosure action is subject to most of the delays and expenses of
other lawsuits if defenses are raised or counterclaims are interposed, and
sometimes requires several years to complete.
Judicial Foreclosure. A judicial foreclosure proceeding is conducted in a
court having jurisdiction over the mortgaged property. Generally, the action is
initiated by the service of legal pleadings upon all parties having a
subordinate interest of record in the real property and all parties in
possession of the property, under leases or otherwise, whose interests are
subordinate to the mortgage. Delays in completion of the foreclosure may
occasionally result from difficulties in locating defendants. When the lender's
right to foreclose is contested, the legal proceedings can be time-consuming.
Upon successful
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completion of a judicial foreclosure proceeding, the court generally issues a
judgment of foreclosure and appoints a referee or other officer to conduct a
public sale of the mortgaged property, the proceeds of which are used to
satisfy the judgment. Such sales are made in accordance with procedures that
vary from state to state.
Equitable and Other Limitations on Enforceability of Certain Provisions.
United States courts have traditionally imposed general equitable principles to
limit the remedies available to lenders in foreclosure actions. These principles
are generally designed to relieve borrowers from the effects of mortgage
defaults perceived as harsh or unfair. Relying on such principles, a court may
alter the specific terms of a loan to the extent it considers necessary to
prevent or remedy an injustice, undue oppression or overreaching, or may require
the lender to undertake affirmative actions to determine the cause of the
borrower's default and the likelihood that the borrower will be able to
reinstate the loan. In some cases, courts have substituted their judgment for
the lender's and have required that lenders reinstate loans or recast payment
schedules in order to accommodate borrowers who are suffering from a temporary
financial disability. In other cases, courts have limited the right of the
lender to foreclose in the case of a nonmonetary default, such as a failure to
adequately maintain the mortgaged property or an impermissible further
encumbrance of the mortgaged property. Finally, some courts have addressed the
issue of whether federal or state constitutional provisions reflecting due
process concerns for adequate notice require that a borrower receive notice in
addition to statutorily-prescribed minimum notice. For the most part, these
cases have upheld the reasonableness of the notice provisions or have found that
a public sale under a mortgage providing for a power of sale does not involve
sufficient state action to trigger constitutional protections.
In addition, some states may have statutory protection such as the right
of the borrower to reinstate mortgage loans after commencement of foreclosure
proceedings but prior to a foreclosure sale.
Non-Judicial Foreclosure/Power of Sale. In states permitting non-judicial
foreclosure proceedings, foreclosure of a deed of trust is generally
accomplished by a non-judicial trustee's sale pursuant to a power of sale
typically granted in the deed of trust. A power of sale may also be contained
in any other type of mortgage instrument if applicable law so permits. A power
of sale under a deed of trust allows a non-judicial public sale to be conducted
generally following a request from the beneficiary/lender to the trustee to
sell the property upon default by the borrower and after notice of sale is
given in accordance with the terms of the mortgage and applicable state law. In
some states, prior to such sale, the trustee under the deed of trust must
record a notice of default and notice of sale and send a copy to the borrower
and to any other party who has recorded a request for a copy of a notice of
default and notice of sale. In addition, in some states the trustee must
provide notice to any other party having an interest of record in the real
property, including junior lienholders. A notice of sale must be posted in a
public place and, in most states, published for a specified period of time in
one or more newspapers. The borrower or junior lienholder may then have the
right, during a reinstatement period required in some states, to cure the
default by paying the entire actual amount in arrears (without regard to the
acceleration of the indebtedness), plus the lender's expenses incurred in
enforcing the obligation. In other states, the borrower or the junior
lienholder is not provided a period to reinstate the loan, but has only the
right to pay off the entire debt to prevent the foreclosure sale. Generally,
state law governs the procedure for public sale, the parties entitled to
notice, the method of giving notice and the applicable time periods.
Public Sale. A third party may be unwilling to purchase a mortgaged
property at a public sale because of the difficulty in determining the exact
status of title to the property (due to, among other things, redemption rights
that may exist) and because of the possibility that physical deterioration of
the property may have occurred during the foreclosure proceedings. Therefore,
it is common for the lender to purchase the mortgaged property for an amount
equal to the secured indebtedness and accrued and unpaid interest plus the
expenses of foreclosure, in which event the borrower's debt will be
extinguished, or for a lesser amount in order to preserve its right to seek a
deficiency judgment if such is available under state law and under the terms of
the Mortgage Loan documents. (The Mortgage Loans, however, are generally
expected to be non-recourse. See "Risk Factors--Investment in Commercial and
Multifamily Mortgage Loans".) Thereafter, subject to the borrower's right in
some states to remain in possession during a redemption period, the lender will
become the owner of the property and have both the benefits
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and burdens of ownership, including the obligation to pay debt service on any
senior mortgages, to pay taxes, to obtain casualty insurance and to make such
repairs as are necessary to render the property suitable for sale. The costs of
operating and maintaining a commercial or multifamily residential property may
be significant and may be greater than the income derived from that property.
The lender also will commonly obtain the services of a real estate broker and
pay the broker's commission in connection with the sale or lease of the
property. Depending upon market conditions, the ultimate proceeds of the sale
of the property may not equal the lender's investment in the property.
Moreover, because of the expenses associated with acquiring, owning and selling
a mortgaged property, a lender could realize an overall loss on a mortgage loan
even if the mortgaged property is sold at foreclosure, or resold after it is
acquired through foreclosure, for an amount equal to the full outstanding
principal amount of the loan plus accrued interest.
The holder of a junior mortgage that forecloses on a mortgaged property
does so subject to senior mortgages and any other prior liens, and may be
obliged to keep senior mortgage loans current in order to avoid foreclosure of
its interest in the property. In addition, if the foreclosure of a junior
mortgage triggers the enforcement of a "due-on-sale" clause contained in a
senior mortgage, the junior mortgagee could be required to pay the full amount
of the senior mortgage indebtedness or face foreclosure.
Rights of Redemption. The purposes of a foreclosure action are to enable
the lender to realize upon its security and to bar the borrower, and all
persons who have interests in the property that are subordinate to that of the
foreclosing lender, from exercise of their "equity of redemption". The doctrine
of equity of redemption provides that, until the property encumbered by a
mortgage has been sold in accordance with a properly conducted foreclosure and
foreclosure sale, those having interests that are subordinate to that of the
foreclosing lender have an equity of redemption and may redeem the property by
paying the entire debt with interest. Those having an equity of redemption must
generally be made parties and joined in the foreclosure proceeding in order for
their equity of redemption to be terminated.
The equity of redemption is a common-law (non-statutory) right which
should be distinguished from post-sale statutory rights of redemption. In some
states, after sale pursuant to a deed of trust or foreclosure of a mortgage,
the borrower and foreclosed junior lienors are given a statutory period in
which to redeem the property. In some states, statutory redemption may occur
only upon payment of the foreclosure sale price. In other states, redemption
may be permitted if the former borrower pays only a portion of the sums due.
The effect of a statutory right of redemption is to diminish the ability of the
lender to sell the foreclosed property because the exercise of a right of
redemption would defeat the title of any purchaser through a foreclosure.
Consequently, the practical effect of the redemption right is to force the
lender to maintain the property and pay the expenses of ownership until the
redemption period has expired. In some states, a post-sale statutory right of
redemption may exist following a judicial foreclosure, but not following a
trustee's sale under a deed of trust.
Anti-Deficiency Legislation. Some or all of the Mortgage Loans may be
nonrecourse loans, as to which recourse in the case of default will be limited
to the Mortgaged Property and such other assets, if any, that were pledged to
secure the Mortgage Loan. However, even if a mortgage loan by its terms
provides for recourse to the borrower's other assets, a lender's ability to
realize upon those assets may be limited by state law. For example, in some
states a lender cannot obtain a deficiency judgment against the borrower
following foreclosure or sale under a deed of trust. A deficiency judgment is a
personal judgment against the former borrower equal to the difference between
the net amount realized upon the public sale of the real property and the
amount due to the lender. Other statutes may require the lender to exhaust the
security afforded under a mortgage before bringing a personal action against
the borrower. In certain other states, the lender has the option of bringing a
personal action against the borrower on the debt without first exhausting such
security; however, in some of those states, the lender, following judgment on
such personal action, may be deemed to have elected a remedy and thus may be
precluded from foreclosing upon the security. Consequently, lenders in those
states where such an election of remedy provision exists will usually proceed
first against the security. Finally, other statutory provisions, designed to
protect borrowers from exposure to large deficiency judgments that might result
from bidding at below-market values at the foreclosure sale, limit any
deficiency judgment to the excess of the outstanding debt over the fair market
value of the property at the time of the sale.
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Leasehold Considerations. Mortgage Loans may be secured by a mortgage on
the borrower's leasehold interest in a ground lease. Leasehold mortgage loans
are subject to certain risks not associated with mortgage loans secured by a
lien on the fee estate of the borrower. The most significant of these risks is
that if the borrower's leasehold were to be terminated upon a lease default,
the leasehold mortgagee would lose its security. This risk may be lessened if
the ground lease requires the lessor to give the leasehold mortgagee notices of
lessee defaults and an opportunity to cure them, permits the leasehold estate
to be assigned to and by the leasehold mortgagee or the purchaser at a
foreclosure sale, and contains certain other protective provisions typically
included in a "mortgageable" ground lease. Certain Mortgage Loans, however, may
be secured by ground leases which do not contain these provisions.
Cross-Collateralization. Certain of the Mortgage Loans may be secured by
more than one mortgage covering properties located in more than one state.
Because of various state laws governing foreclosure or the exercise of a power
of sale and because, in general, foreclosure actions are brought in state court
and the courts of one state cannot exercise jurisdiction over property in
another state, it may be necessary upon a default under a cross-collateralized
Mortgage Loan to foreclose on the related mortgages in a particular order
rather than simultaneously in order to ensure that the lien of the mortgages is
not impaired or released.
BANKRUPTCY LAWS
Operation of the Bankruptcy Code and related state laws may interfere with
or affect the ability of a lender to realize upon collateral and/or to enforce
a deficiency judgment. For example, under the Bankruptcy Code, virtually all
actions (including foreclosure actions and deficiency judgment proceedings) to
collect a debt are automatically stayed upon the filing of the bankruptcy
petition and, often, no interest or principal payments are made during the
course of the bankruptcy case. The delay and the consequences thereof caused by
such automatic stay can be significant. Also, under the Bankruptcy Code, the
filing of a petition in bankruptcy by or on behalf of a junior lienor may stay
the senior lender from taking action to foreclose out such junior lien.
Under the Bankruptcy Code, provided certain substantive and procedural
safeguards protective of the lender are met, the amount and terms of a mortgage
loan secured by a lien on property of the debtor may be modified under certain
circumstances. For example, the outstanding amount of the loan may be reduced
to the then-current value of the property (with a corresponding partial
reduction of the amount of lender's security interest) pursuant to a confirmed
plan or lien avoidance proceeding, thus leaving the lender a general unsecured
creditor for the difference between such value and the outstanding balance of
the loan. Other modifications may include the reduction in the amount of each
scheduled payment, by means of a reduction in the rate of interest and/or an
alteration of the repayment schedule (with or without affecting the unpaid
principal balance of the loan), and/or by an extension (or shortening) of the
term to maturity. Some bankruptcy courts have approved plans, based on the
particular facts of the reorganization case, that effected the cure of a
mortgage loan default by paying arrearages over a number of years. Also, a
bankruptcy court may permit a debtor, through its rehabilitative plan, to
reinstate a loan mortgage payment schedule even if the lender has obtained a
final judgment of foreclosure prior to the filing of the debtor's petition.
Federal bankruptcy law may also have the effect of interfering with or
affecting the ability of a secured lender to enforce the borrower's assignment
of rents and leases related to the mortgaged property. Under the Bankruptcy
Code, a lender may be stayed from enforcing the assignment, and the legal
proceedings necessary to resolve the issue could be time-consuming, with
resulting delays in the lender's receipt of the rents. Recent amendments to the
Bankruptcy code, however, may minimize the impairment of the lender's ability
to enforce the borrower's assignment of rents and leases. In addition to the
inclusion of hotel revenues within the definition of "cash collateral" as noted
previously in the section entitled "--Leases and Rents", the amendments provide
that a pre-petition security interest in rents or hotel revenues is designed to
overcome those cases holding that a security interest in rents is unperfected
under the laws of certain states until the lender has taken some further
action, such as commencing foreclosure or obtaining a receiver prior to
activation of the assignment of rents.
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If a borrower's ability to make payment on a mortgage loan is dependent on
its receipt of rent payments under a lease of the related property, that
ability may be impaired by the commencement of a bankruptcy case relating to a
lessee under such lease. Under the Bankruptcy Code, the filing of a petition in
bankruptcy by or on behalf of a lessee results in a stay in bankruptcy against
the commencement or continuation of any state court proceeding for past due
rent, for accelerated rent, for damages or for a summary eviction order with
respect to a default under the lease that occurred prior to the filing of the
lessee's petition. In addition, the Bankruptcy Code generally provides that a
trustee or debtor-in-possession may, subject to approval of the court, (i)
assume the lease and retain it or assign it to a third party or (ii) reject the
lease. If the lease is assumed, the trustee or debtor-in-possession (or
assignee, if applicable) must cure any defaults under the lease, compensate the
lessor for its losses and provide the lessor with "adequate assurance" of
future performance. Such remedies may be insufficient, and any assurances
provided to the lessor may, in fact, be inadequate. If the lease is rejected,
the lessor will be treated as an unsecured creditor with respect to its claim
for damages for termination of the lease. The Bankruptcy Code also limits a
lessor's damages for lease rejection to the rent reserved by the lease (without
regard to acceleration) for the greater of one year, or 15%, not to exceed
three years, of the remaining term of the lease.
ENVIRONMENTAL CONSIDERATIONS
General. A lender may be subject to environmental risks when taking a
security interest in real property. Of particular concern may be properties
that are or have been used for industrial, manufacturing, military or disposal
activity. Such environmental risks include the possible diminution of the value
of a contaminated property or, as discussed below, potential liability for
clean-up costs or other remedial actions that could exceed the value of the
property or the amount of the lender's loan. In certain circumstances, a lender
may decide to abandon a contaminated mortgaged property as collateral for its
loan rather than foreclose and risk liability for clean-up costs.
Superlien Laws. Under the laws of many states, contamination on a property
may give rise to a lien on the property for clean-up costs. In several states,
such a lien has priority over all existing liens, including those of existing
mortgages. In these states, the lien of a mortgage may lose its priority to
such a "superlien".
CERCLA. The federal Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended ("CERCLA"), imposes strict liability on
present and past "owners" and "operators" of contaminated real property for the
costs of clean-up. A secured lender may be liable as an "owner" or "operator"
of a contaminated mortgaged property if agents or employees of the lender have
participated in the management of such mortgaged property or the operations of
the borrower. Such liability may exist even if the lender did not cause or
contribute to the contamination and regardless of whether the lender has
actually taken possession of a mortgaged property through foreclosure, deed in
lieu of foreclosure or otherwise. Moreover, such liability is not limited to
the original or unamortized principal balance of a loan or to the value of the
property securing a loan. Excluded from CERCLA's definition of "owner" or
"operator", however, is a person "who without participating in the management
of the facility, holds indicia of ownership primarily to protect his security
interest". This is the so called "secured creditor exemption".
The Asset Conservation, Lender Liability and Deposit Insurance Act of 1996
(the "Act") amended, among other things, the provisions of CERCLA with respect
to lender liability and the secured creditor exemption. The Act offers
substantial protection to lenders by defining the activities in which a lender
can engage and still have the benefit of the secured creditor exemption. In
order for a lender to be deemed to have participated in the management of a
mortgaged property, the lender must actually participate in the operational
affairs of the property of the borrower. The Act provides that "merely having
the capacity to influence, or unexercised right to control" operations does not
constitute participation in management. A lender will lose the protection of
the secured creditor exemption only if it exercises decision-making control
over the borrower's environmental compliance and hazardous substance handling
and disposal practices, or assumes day-to-day management of all operational
functions of the mortgaged property. The Act also provides that a lender will
continue to have the benefit of the secured creditor
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exemption even if it forecloses on a mortgaged property, purchases it at a
foreclosure sale or accepts a deed-in-lieu of foreclosure provided that the
lender seeks to sell the mortgaged property at the earliest practicable
commercially reasonable time on commercially reasonable terms.
Certain Other Federal and State Laws. Many states have statutes similar to
CERCLA, and not all of those statutes provide for a secured creditor exemption.
In addition, under federal law, there is potential liability relating to
hazardous wastes and underground storage tanks under the federal Resource
Conservation and Recovery Act ("RCRA").
In addition, the definition of "hazardous substances" under CERCLA
specifically excludes petroleum products. Subtitle I of RCRA governs
underground petroleum storage tanks. Under the Act the protections accorded to
lenders under CERCLA are also accorded to the holders of security interests in
underground storage tanks. It should be noted, however, that liability for
cleanup of petroleum contamination may be governed by state law, which may not
provide for any specific protection for secured creditors.
In a few states, transfers of some types of properties are conditioned
upon cleanup of contamination prior to transfer. In these cases, a lender that
becomes the owner of a property through foreclosure, deed in lieu of
foreclosure or otherwise, may be required to clean up the contamination before
selling or otherwise transferring the property.
Beyond statute-based environmental liability, there exist common law
causes of action (for example, actions based on nuisance or on toxic tort
resulting in death, personal injury or damage to property) related to hazardous
environmental conditions on a property. While it may be more difficult to hold
a lender liable in such cases, unanticipated or uninsured liabilities of the
borrower may jeopardize the borrower's ability to meet its loan obligations.
Additional Considerations. The cost of remediating hazardous substance
contamination at a property can be substantial. If a lender becomes liable, it
can bring an action for contribution against the owner or operator who created
the environmental hazard, but that individual or entity may be without
substantial assets. Accordingly, it is possible that such costs could become a
liability of the Trust Fund and occasion a loss to the Certificateholders.
To reduce the likelihood of such a loss, unless otherwise specified in the
related Prospectus Supplement, the Pooling and Servicing Agreement will provide
that the Master Servicer, acting on behalf of the Trustee, may not acquire
title to a Mortgaged Property or take over its operation unless the Master
Servicer, based solely (as to environmental matters) on a report prepared by a
person who regularly conducts environmental audits, has made the determination
that it is appropriate to do so, as described under "The Pooling and Servicing
Agreements-Realization Upon Defaulted Mortgage Loans".
If a lender forecloses on a mortgage secured by a property, the operations
on which are subject to environmental laws and regulations, the lender will be
required to operate the property in accordance with those laws and regulations.
Such compliance may entail substantial expense, especially in the case of
industrial or manufacturing properties.
In addition, a lender may be obligated to disclose environmental
conditions on a property to government entities and/or to prospective buyers
(including prospective buyers at a foreclosure sale or following foreclosure).
Such disclosure may decrease the amount that prospective buyers are willing to
pay for the affected property, sometimes substantially, and thereby decrease
the ability of the lender to recoup its investment in a loan upon foreclosure.
Environmental Site Assessments. In most cases, an environmental site
assessment of each Mortgaged Property will have been performed in connection
with the origination of the related Mortgage Loan or at some time prior to the
issuance of the related Certificates. Environmental site assessments, however,
vary considerably in their content, quality and cost. Even when adhering to
good professional practices, environmental consultants will sometimes not
detect significant environmental problems because to do an exhaustive
environmental assessment would be far too costly and time-consuming to be
practical.
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DUE-ON-SALE AND DUE-ON-ENCUMBRANCE
Certain of the Mortgage Loans may contain "due-on-sale" and
"due-on-encumbrance" clauses that purport to permit the lender to accelerate
the maturity of the loan if the borrower transfers or encumbers the related
Mortgaged Property. In recent years, court decisions and legislative actions
placed substantial restrictions on the right of lenders to enforce such clauses
in many states. However, the Garn-St Germain Depository Institutions Act of
1982 (the "Garn Act") generally preempts state laws that prohibit the
enforcement of due-on-sale clauses and permits lenders to enforce these clauses
in accordance with their terms, subject to certain limitations as set forth in
the Garn Act and the regulations promulgated thereunder. Accordingly, a Master
Servicer may nevertheless have the right to accelerate the maturity of a
Mortgage Loan that contains a "due-on-sale" provision upon transfer of an
interest in the property, without regard to the Master Servicer's ability to
demonstrate that a sale threatens its legitimate security interest.
SUBORDINATE FINANCING
The terms of certain of the Mortgage Loans may not restrict the ability of
the borrower to use the Mortgaged Property as security for one or more
additional loans, or such restrictions may be unenforceable. Where a borrower
encumbers a mortgaged property with one or more junior liens, the senior lender
is subjected to additional risk. First, the borrower may have difficulty
servicing and repaying multiple loans. Moreover, if the subordinate financing
permits recourse to the borrower (as is frequently the case) and the senior
loan does not, a borrower may have more incentive to repay sums due on the
subordinate loan. Second, acts of the senior lender that prejudice the junior
lender or impair the junior lender's security may create a superior equity in
favor of the junior lender. For example, if the borrower and the senior lender
agree to an increase in the principal amount of or the interest rate payable on
the senior loan, the senior lender may lose its priority to the extent any
existing junior lender is harmed or the borrower is additionally burdened.
Third, if the borrower defaults on the senior loan and/or any junior loan or
loans, the existence of junior loans and actions taken by junior lenders can
impair the security available to the senior lender and can interfere with or
delay the taking of action by the senior lender. Moreover, the bankruptcy of a
junior lender may operate to stay foreclosure or similar proceedings by the
senior lender.
DEFAULT INTEREST AND LIMITATIONS ON PREPAYMENTS
Notes and mortgages may contain provisions that obligate the borrower to
pay a late charge or additional interest if payments are not timely made, and
in some circumstances, may prohibit prepayments for a specified period and/or
condition prepayments upon the borrower's payment of prepayment fees or yield
maintenance penalties. In certain states, there are or may be specific
limitations upon the late charges which a lender may collect from a borrower
for delinquent payments. Certain states also limit the amounts that a lender
may collect from a borrower as an additional charge if the loan is prepaid. In
addition, the enforceability of provisions that provide for prepayment fees or
penalties upon an involuntary prepayment is unclear under the laws of many
states.
APPLICABILITY OF USURY LAWS
Title V of the Depository Institutions Deregulation and Monetary Control
Act of 1980 ("Title V") provides that state usury limitations shall not apply
to certain types of residential (including multifamily) first mortgage loans
originated by certain lenders after March 31, 1980. Title V authorized any
state to reimpose interest rate limits by adopting, before April 1, 1983, a law
or constitutional provision that expressly rejects application of the federal
law. In addition, even where Title V is not so rejected, any state is
authorized by the law to adopt a provision limiting discount points or other
charges on mortgage loans covered by Title V. Certain states have taken action
to reimpose interest rate limits and/or to limit discount points or other
charges.
No Mortgage Loan originated in any state in which application of Title V
has been expressly rejected or a provision limiting discount points or other
charges has been adopted, will (if originated after that
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rejection or adoption) be eligible for inclusion in a Trust Fund unless (i)
such Mortgage Loan provides for such interest rate, discount points and charges
as are permitted in such state or (ii) such Mortgage Loan provides that the
terms thereof are to be construed in accordance with the laws of another state
under which such interest rate, discount points and charges would not be
usurious and the borrower's counsel has rendered an opinion that such choice of
law provision would be given effect.
SOLDIERS' AND SAILORS' CIVIL RELIEF ACT OF 1940
Under the terms of the Soldiers' and Sailors' Civil Relief Act of 1940, as
amended (the "Relief Act"), a borrower who enters military service after the
origination of such borrower's mortgage loan (including a borrower who was in
reserve status and is called to active duty after origination of the Mortgage
Loan), may not be charged interest (including fees and charges) above an annual
rate of 6% during the period of such borrower's active duty status, unless a
court orders otherwise upon application of the lender. The Relief Act applies
to individuals who are members of the Army, Navy, Air Force, Marines, National
Guard, Reserves, Coast Guard and officers of the U.S. Public Health Service
assigned to duty with the military. Because the Relief Act applies to
individuals who enter military service (including reservists who are called to
active duty) after origination of the related mortgage loan, no information can
be provided as to the number of loans with individuals as borrowers that may be
affected by the Relief Act. Application of the Relief Act would adversely
affect, for an indeterminate period of time, the ability of a Master Servicer
or Special Servicer to collect full amounts of interest on certain of the
Mortgage Loans. Any shortfalls in interest collections resulting from the
application of the Relief Act would result in a reduction of the amounts
distributable to the holders of the related series of Certificates, and would
not be covered by advances or, unless otherwise specified in the related
Prospectus Supplement, any form of Credit Support provided in connection with
such Certificates. In addition, the Relief Act imposes limitations that would
impair the ability of a Master Servicer or Special Servicer to foreclose on an
affected Mortgage Loan during the borrower's period of active duty status, and,
under certain circumstances, during an additional three month period
thereafter.
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CERTAIN FEDERAL INCOME TAX CONSEQUENCES
GENERAL
The following is a general discussion of the anticipated material federal
income tax consequences of the purchase, ownership and disposition of Offered
Certificates. The following summary is based on the Code as well as Treasury
regulations and administrative and judicial rulings and practice. Legislative,
judicial and administrative changes may occur, possibly with retroactive
effect, that could alter or modify the continued validity of the statements and
conclusions set forth herein. This summary does not purport to address all
federal income tax matters that may be relevant to particular holders. For
example, it generally is addressed only to original purchasers of the
Certificates that are United States investors, deals only with Certificates
held as capital assets within the meaning of Section 1221 of the Code, and does
not address tax consequences to holders that may be relevant to investors
subject to special rules, such as non- U.S. investors, banks, insurance
companies, tax-exempt organizations, electing large partnerships, dealers in
securities or currencies, mutual funds, REITs, S corporations, estates and
trusts, investors that hold the Certificates as part of a hedge, straddle,
integrated or conversion transaction, or holders whose "functional currency" is
not the United States dollar. Further, it does not address alternative minimum
tax consequences or the indirect effects on the holders of equity interests in
an entity that is a beneficial owner of the Certificates. Further, this
discussion does not address the state or local tax consequences of the
purchase, ownership and disposition of such Certificates. Investors should
consult their tax advisers in determining the federal, state, local, or other
tax consequences to them of the purchase, ownership and disposition of the
Certificates offered hereunder. See "State and Other Tax Consequences".
The following discussion addresses certificates ("REMIC Certificates")
representing interests in a Trust Fund, or a portion thereof, that the Master
Servicer or the Trustee will elect to have treated as a REMIC under Sections
860A through 860G (the "REMIC Provisions") of the Code. The Prospectus
Supplement for each series of Certificates will indicate whether a REMIC
election (or elections) will be made for the related Trust Fund and, if such an
election is to be made, will identify all "regular interests" and "residual
interests" in the REMIC. If a REMIC election will not be made for a Trust Fund,
the federal income tax consequences of the purchase, ownership and disposition
of the related Certificates will be set forth in the related Prospectus
Supplement. For purposes of this tax discussion, references to a
"Certificateholder" or a "holder" are to the beneficial owner of a Certificate.
The following discussion is limited in applicability to Offered
Certificates. Moreover, this discussion applies only to the extent that
Mortgage Assets held by a Trust Fund consist solely of Mortgage Loans. To the
extent that other Mortgage Assets, including REMIC certificates and mortgage
pass-through certificates, are to be held by a Trust Fund, the tax consequences
associated with the inclusion of such assets will be disclosed in the related
Prospectus Supplement. In addition, if Cash Flow Agreements, other than
guaranteed investment contracts, are included in a Trust Fund, the tax
consequences associated with such Cash Flow Agreements also will be disclosed
in the related Prospectus Supplement. See "Description of the Trust Funds--Cash
Flow Agreements".
Furthermore, the following discussion is based in part upon the rules
governing original issue discount that are set forth in Sections 1271-1273 and
1275 of the Code and in the Treasury regulations issued thereunder (the "OID
Regulations"), and in part upon the REMIC Provisions and the Treasury
regulations issued thereunder (the "REMIC Regulations"). The OID Regulations do
not adequately address certain issues relevant to, and in some instances
provide that they are not applicable to, securities such as the Certificates.
REMICS
Classification of REMICs. Upon the issuance of each series of REMIC
Certificates, counsel to the Depositor will deliver its opinion generally to
the effect that, assuming compliance with all provisions of the related Pooling
and Servicing Agreement, the related Trust Fund (or each applicable portion
thereof) will qualify as a REMIC and the REMIC Certificates offered with
respect thereto will be considered to evidence ownership of REMIC Regular
Certificates or REMIC Residual Certificates in that REMIC within the meaning of
the REMIC Provisions.
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If an entity electing to be treated as a REMIC fails to comply with one or
more of the ongoing requirements of the Code for such status during any taxable
year, the Code provides that the entity will not be treated as a REMIC for such
year and thereafter. In that event, such entity may be taxable as a corporation
under Treasury regulations, and the related REMIC Certificates may not be
accorded the status or given the tax treatment described below. Although the
Code authorizes the Treasury Department to issue regulations providing relief
in the event of an inadvertent termination of REMIC status, no such regulations
have been issued. Any such relief, moreover, may be accompanied by sanctions,
such as the imposition of a corporate tax on all or a portion of the Trust
Fund's income for the period in which the requirements for such status are not
satisfied. The Pooling and Servicing Agreement with respect to each REMIC will
include provisions designed to maintain the Trust Fund's status as a REMIC
under the REMIC Provisions. It is not anticipated that the status of any Trust
Fund as a REMIC will be inadvertently terminated.
Tiered REMIC Structures. For certain series of REMIC Certificates, two or
more separate elections may be made to treat designated portions of the related
Trust Fund as REMICs ("Tiered REMICs") for federal income tax purposes. Upon
the issuance of any such series of REMIC Certificates, counsel to the Depositor
will deliver its opinion generally to the effect that, assuming compliance with
all provisions of the related Pooling and Servicing Agreement, the Tiered
REMICs will each qualify as a REMIC and the REMIC Certificates issued by the
Tiered REMICs, will be considered to evidence ownership of REMIC Regular
Certificates or REMIC Residual Certificates in the related REMIC within the
meaning of the REMIC Provisions.
Taxation of Owners of REMIC Regular Certificates
General. Except as otherwise stated in this discussion, REMIC Regular
Certificates will be treated for federal income tax purposes as debt
instruments issued by the REMIC and not as ownership interests in the REMIC or
its assets. Moreover, holders of REMIC Regular Certificates that otherwise
report income under a cash method of accounting will be required to report
income with respect to REMIC Regular Certificates under an accrual method.
Original Issue Discount. Certain REMIC Regular Certificates may be issued
with "original issue discount" within the meaning of Section 1273(a) of the
Code. Any holders of REMIC Regular Certificates issued with original issue
discount generally will be required to include original issue discount in
income as it accrues, in accordance with the method described below, in advance
of the receipt of the cash attributable to such income. In addition, Section
1272(a)(6) of the Code provides special rules applicable to REMIC Regular
Certificates and certain other debt instruments issued with original issue
discount. Regulations have not been issued under that section.
The Code requires that a prepayment assumption be used with respect to
Mortgage Loans held by a REMIC in computing the accrual of original issue
discount on REMIC Regular Certificates issued by that REMIC, and that
adjustments be made in the amount and rate of accrual of such discount to
reflect differences between the actual prepayment rate and the prepayment
assumption. The prepayment assumption is to be determined in a manner
prescribed in Treasury regulations; as noted above, those regulations have not
been issued. The Conference Committee Report accompanying the Tax Reform Act of
1986 (the "Committee Report") indicates that the regulations will provide that
the prepayment assumption used with respect to a REMIC Regular Certificate must
be the same as that used in pricing the initial offering of such REMIC Regular
Certificate. The prepayment assumption (the "Prepayment Assumption") used in
reporting original issue discount for each series of REMIC Regular Certificates
will be consistent with this standard and will be disclosed in the related
Prospectus Supplement. However, neither the Depositor nor any other person will
make any representation that the Mortgage Loans will in fact prepay at a rate
conforming to the Prepayment Assumption or at any other rate.
The original issue discount, if any, on a REMIC Regular Certificate will
be the excess of its stated redemption price at maturity over its issue price.
The issue price of a particular class of REMIC Regular Certificates will be the
first cash price at which a substantial amount of REMIC Regular Certificates of
that class is sold (excluding sales to bond houses, brokers and underwriters).
If less than a substantial amount of a particular class of REMIC Regular
Certificates is sold for cash on or prior to the date of their
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initial issuance (the "Closing Date"), the issue price for such class will be
the fair market value of such class on the Closing Date. Under the OID
Regulations, the stated redemption price of a REMIC Regular Certificate is
equal to the total of all payments to be made on such Certificate other than
"qualified stated interest". "Qualified stated interest" is interest that is
unconditionally payable at least annually at a single fixed rate, or at a
"qualified floating rate", an "objective rate", a combination of a single fixed
rate and one or more "qualified floating rates" or one "qualified inverse
floating rate", or a combination of "qualified floating rates" that does not
operate in a manner that accelerates or defers interest payments on such REMIC
Regular Certificate.
In the case of REMIC Regular Certificates bearing adjustable interest
rates, the determination of the total amount of original issue discount and the
timing of the inclusion thereof will vary according to the characteristics of
such REMIC Regular Certificates. If the original issue discount rules apply to
such Certificates, the related Prospectus Supplement will describe the manner
in which such rules will be applied with respect to those Certificates in
preparing information returns to the Certificateholders and the IRS.
Certain classes of the REMIC Regular Certificates may provide for the
first interest payment with respect to such Certificates to be made more than
one month after the date of issuance, a period which is longer than the
subsequent monthly intervals between interest payments. Assuming the "accrual
period" (as defined below) for original issue discount is each monthly period
that ends on a Distribution Date, in some cases, as a consequence of this "long
first accrual period", some or all interest payments may be required to be
included in the stated redemption price of the REMIC Regular Certificate and
accounted for as original issue discount. Because interest on REMIC Regular
Certificates must in any event be accounted for under an accrual method,
applying this analysis would result in only a slight difference in the timing
of the inclusion in income of the yield on the REMIC Regular Certificates.
In addition, if the accrued interest to be paid on the first Distribution
Date is computed with respect to a period that begins prior to the Closing
Date, a portion of the purchase price paid for a REMIC Regular Certificate will
reflect such accrued interest. In such cases, information returns provided to
the Certificateholders and the IRS will be based on the position that the
portion of the purchase price paid for the interest accrued with respect to
periods prior to the Closing Date is treated as part of the overall cost of
such REMIC Regular Certificate (and not as a separate asset the cost of which
is recovered entirely out of interest received on the next Distribution Date)
and that portion of the interest paid on the first Distribution Date in excess
of interest accrued for a number of days corresponding to the number of days
from the Closing Date to the first Distribution Date should be included in the
stated redemption price of such REMIC Regular Certificate. However, the OID
Regulations state that all or some portion of such accrued interest may be
treated as a separate asset the cost of which is recovered entirely out of
interest paid on the first Distribution Date. It is unclear how an election to
do so would be made under the OID Regulations and whether such an election
could be made unilaterally by a Certificateholder.
Notwithstanding the general definition of original issue discount,
original issue discount on a REMIC Regular Certificate will be considered to be
de minimis if it is less than 0.25% of the stated redemption price of the REMIC
Regular Certificate multiplied by its weighted average life. For this purpose,
the weighted average life of the REMIC Regular Certificate is computed as the
sum of the amounts determined, as to each payment included in the stated
redemption price of such REMIC Regular Certificate, by multiplying (i) the
number of complete years (rounding down for partial years) from the issue date
until such payment is expected to be made (presumably taking into account the
Prepayment Assumption) by (ii) a fraction, the numerator of which is the amount
of the payment, and the denominator of which is the stated redemption price at
maturity of such REMIC Regular Certificate. Under the OID Regulations, original
issue discount of only a de minimis amount (other than de minimis original
issue discount attributable to a so-called "teaser" interest rate or an initial
interest holiday) will be included in income as each payment of stated
principal is made, based on the product of the total amount of such de minimis
original issue discount and a fraction, the numerator of which is the amount of
such principal payment and the denominator of which is the outstanding stated
principal amount of the REMIC Regular Certificate. The OID Regulations also
would permit a Certificateholder to elect to accrue de minimis original issue
discount into income currently based on a constant yield method. See
"--Taxation of Owners of REMIC Regular Certificates--Market Discount" for a
description of such election under the OID Regulations.
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If original issue discount on a REMIC Regular Certificate is in excess of
a de minimis amount, the holder of such Certificate must include in ordinary
gross income the sum of the "daily portions" of original issue discount for
each day during its taxable year on which it held such REMIC Regular
Certificate, including the purchase date but excluding the disposition date. In
the case of an original holder of a REMIC Regular Certificate, the daily
portions of original issue discount will be determined as follows.
As to each "accrual period", that is, unless otherwise stated in the
related Prospectus Supplement, each period that ends on a date that corresponds
to a Distribution Date and begins on the first day following the immediately
preceding accrual period (or in the case of the first such period, begins on
the Closing Date), a calculation will be made of the portion of the original
issue discount that accrued during such accrual period. The portion of original
issue discount that accrues in any accrual period will equal the excess, if
any, of (i) the sum of (a) the present value, as of the end of the accrual
period, of all of the distributions remaining to be made on the REMIC Regular
Certificate, if any, in future periods and (b) the distributions made on such
REMIC Regular Certificate during the accrual period of amounts included in the
stated redemption price, over (ii) the adjusted issue price of such REMIC
Regular Certificate at the beginning of the accrual period. The present value
of the remaining distributions referred to in the preceding sentence will be
calculated (i) assuming that distributions on the REMIC Regular Certificate
will be received in future periods based on the Mortgage Loans being prepaid at
a rate equal to the Prepayment Assumption and (ii) using a discount rate equal
to the original yield to maturity of the Certificate. For these purposes, the
original yield to maturity of the Certificate will be calculated based on its
issue price and assuming that distributions on the Certificate will be made in
all accrual periods based on the Mortgage Loans being prepaid at a rate equal
to the Prepayment Assumption. The adjusted issue price of a REMIC Regular
Certificate at the beginning of any accrual period will equal the issue price
of such Certificate, increased by the aggregate amount of original issue
discount that accrued with respect to such Certificate in prior accrual
periods, and reduced by the amount of any distributions made on such REMIC
Regular Certificate in prior accrual periods of amounts included in the stated
redemption price. The original issue discount accruing during any accrual
period, computed as described above, will be allocated ratably to each day
during the accrual period to determine the daily portion of original issue
discount for such day.
A subsequent purchaser of a REMIC Regular Certificate that purchases such
Certificate at a cost (excluding any portion of such cost attributable to
accrued qualified stated interest) less than its remaining stated redemption
price will also be required to include in gross income the daily portions of
any original issue discount with respect to such Certificate. However, each
such daily portion will be reduced, if such cost is in excess of its "adjusted
issue price", in proportion to the ratio such excess bears to the aggregate
original issue discount remaining to be accrued on such REMIC Regular
Certificate. The adjusted issue price of a REMIC Regular Certificate on any
given day equals the sum of (i) the adjusted issue price (or, in the case of
the first accrual period, the issue price) of such Certificate at the beginning
of the accrual period which includes such day and (ii) the daily portions of
original issue discount for all days during such accrual period prior to such
day.
Market Discount. A Certificateholder that purchases a REMIC Regular
Certificate at a market discount, that is, in the case of a REMIC Regular
Certificate issued without original issue discount, at a purchase price less
than its remaining stated principal amount, or in the case of a REMIC Regular
Certificate issued with original issue discount, at a purchase price less than
its adjusted issue price will recognize gain upon receipt of each distribution
representing stated redemption price. In particular, under Section 1276 of the
Code such a Certificateholder generally will be required to allocate the
portion of each such distribution representing stated redemption price first to
accrued market discount not previously included in income, and to recognize
ordinary income to that extent. A Certificateholder may elect to include market
discount in income currently as it accrues rather than including it on a
deferred basis in accordance with the foregoing. If made, such election will
apply to all market discount bonds acquired by such Certificateholder on or
after the first day of the first taxable year to which such election applies.
In addition, the OID Regulations permit a Certificateholder to elect to accrue
all interest, discount (including de minimis market or original issue discount)
and premium in income as interest, based on a constant yield method. If such an
election were made with respect to a REMIC Regular Certificate with
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market discount, the Certificateholder would be deemed to have made an election
to include currently market discount in income with respect to all other debt
instruments having market discount that such Certificateholder acquires during
the taxable year of the election or thereafter, and possibly previously
acquired instruments. Similarly, a Certificateholder that made this election
for a Certificate that is acquired at a premium would be deemed to have made an
election to amortize bond premium with respect to all debt instruments having
amortizable bond premium that such Certificateholder owns or acquires. See
"--Taxation of Owners of REMIC Regular Certificates--Premium" below. Each of
these elections to accrue interest, discount and premium with respect to a
Certificate on a constant yield method or as interest would be irrevocable.
However, market discount with respect to a REMIC Regular Certificate will
be considered to be de minimis for purposes of Section 1276 of the Code if such
market discount is less than 0.25% of the remaining stated redemption price of
such REMIC Regular Certificate multiplied by the number of complete years to
maturity remaining after the date of its purchase. In interpreting a similar
rule with respect to original issue discount on obligations payable in
installments, the OID Regulations refer to the weighted average maturity of
obligations, and it is likely that the same rule will be applied with respect
to market discount, presumably taking into account the Prepayment Assumption.
If market discount is treated as de minimis under this rule, it appears that
the actual discount would be treated in a manner similar to original issue
discount of a de minimis amount. See "--Taxation of Owners of REMIC Regular
Certificates--Original Issue Discount" above. Such treatment would result in
discount being included in income at a slower rate than discount would be
required to be included in income using the method described above.
Section 1276(b)(3) of the Code specifically authorizes the Treasury
Department to issue regulations providing for the method for accruing market
discount on debt instruments, the principal of which is payable in more than
one installment. Until regulations are issued by the Treasury Department,
certain rules described in the Committee Report apply. The Committee Report
indicates that in each accrual period market discount on REMIC Regular
Certificates should accrue, at the Certificateholder's option: (i) on the basis
of a constant yield method, (ii) in the case of a REMIC Regular Certificate
issued without original issue discount, in an amount that bears the same ratio
to the total remaining market discount as the stated interest paid in the
accrual period bears to the total amount of stated interest remaining to be
paid on the REMIC Regular Certificate as of the beginning of the accrual
period, or (iii) in the case of a REMIC Regular Certificate issued with
original issue discount, in an amount that bears the same ratio to the total
remaining market discount as the original issue discount accrued in the accrual
period bears to the total original issue discount remaining on the REMIC
Regular Certificate at the beginning of the accrual period. Moreover, the
Prepayment Assumption used in calculating the accrual of original issue
discount is also used in calculating the accrual of market discount. Because
the regulations referred to in this paragraph have not been issued, it is not
possible to predict what effect such regulations might have on the tax
treatment of a REMIC Regular Certificate purchased at a discount in the
secondary market.
To the extent that REMIC Regular Certificates provide for monthly or other
periodic distributions throughout their term, the effect of these rules may be
to require market discount to be includible in income at a rate that is not
significantly slower than the rate at which such discount would accrue if it
were original issue discount. Moreover, in any event a holder of a REMIC
Regular Certificate generally will be required to treat a portion of any gain
on the sale or exchange of such Certificate as ordinary income to the extent of
the market discount accrued to the date of disposition under one of the
foregoing methods, less any accrued market discount previously reported as
ordinary income.
Further, under Section 1277 of the Code a holder of a REMIC Regular
Certificate may be required to defer a portion of its interest deductions for
the taxable year attributable to any indebtedness incurred or continued to
purchase or carry a REMIC Regular Certificate purchased with market discount.
For these purposes, the de minimis rule referred to above applies. Any such
deferred interest expense would not exceed the market discount that accrues
during such taxable year and is, in general, allowed as a deduction not later
than the year in which such market discount is includible in income. If such
holder elects to include market discount in income currently as it accrues on
all market discount instruments acquired by such holder in that taxable year or
thereafter, the interest deferral rule described above will not apply.
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Premium. A REMIC Regular Certificate purchased at a cost (excluding any
portion of such cost attributable to accrued qualified stated interest) greater
than its remaining stated redemption price will be considered to be purchased
at a premium. The holder of such a REMIC Regular Certificate may elect under
Section 171 of the Code to amortize such premium under the constant yield
method over the life of the Certificate. If made, such an election will apply
to all debt instruments having amortizable bond premium that the holder owns or
subsequently acquires. Amortizable premium will be treated as an offset to
interest income on the related debt instrument, rather than as a separate
interest deduction. The OID Regulations also permit Certificateholders to elect
to include all interest, discount and premium in income based on a constant
yield method, further treating the Certificateholder as having made the
election to amortize premium generally. See "--Taxation of Owners of REMIC
Regular Certificates--Market Discount" above. The Committee Report states that
the same rules that apply to accrual of market discount (which rules will
require use of a Prepayment Assumption in accruing market discount with respect
to REMIC Regular Certificates without regard to whether such Certificates have
original issue discount) will also apply in amortizing bond premium under
Section 171 of the Code.
Realized Losses. Under Section 166 of the Code, both corporate holders of
the REMIC Regular Certificates and noncorporate holders of the REMIC Regular
Certificates that acquire such Certificates in connection with a trade or
business should be allowed to deduct, as ordinary losses, any losses sustained
during a taxable year in which their Certificates become wholly or partially
worthless as the result of one or more realized losses on the Mortgage Loans.
However, it appears that a noncorporate holder that does not acquire a REMIC
Regular Certificate in connection with a trade or business will not be entitled
to deduct a loss under Section 166 of the Code until such holder's Certificate
becomes wholly worthless (i.e., until its outstanding principal balance has
been reduced to zero) and that the loss will be characterized as a short-term
capital loss.
Each holder of a REMIC Regular Certificate will be required to accrue
interest and original issue discount with respect to such Certificate, without
giving effect to any reductions in distributions attributable to defaults or
delinquencies on the Mortgage Loans or the Underlying Certificates until it can
be established that any such reduction ultimately will not be recoverable. As a
result, the amount of taxable income reported in any period by the holder of a
REMIC Regular Certificate could exceed the amount of economic income actually
realized by the holder in such period. Although the holder of a REMIC Regular
Certificate eventually will recognize a loss or reduction in income
attributable to previously accrued and included income that as the result of a
realized loss ultimately will not be realized, the law is unclear with respect
to the timing and character of such loss or reduction in income.
Taxation of Owners of REMIC Residual Certificates
General. As residual interests, the REMIC Residual Certificates will be
subject to tax rules that differ significantly from those that would apply if
the REMIC Residual Certificates were treated for federal income tax purposes as
direct ownership interests in the Mortgage Loans or as debt instruments issued
by the REMIC.
A holder of a REMIC Residual Certificate generally will be required to
report its daily portion of the taxable income or, subject to the limitations
noted in this discussion, the net loss of the REMIC for each day during a
calendar quarter that such holder owned such REMIC Residual Certificate. For
this purpose, the taxable income or net loss of the REMIC will be allocated to
each day in the calendar quarter ratably using a "30 days per month/90 days per
quarter/360 days per year" convention unless otherwise disclosed in the related
Prospectus Supplement. The daily amounts so allocated will then be allocated
among the REMIC Residual Certificateholders in proportion to their respective
ownership interests on such day. Any amount included in the gross income or
allowed as a loss of any REMIC Residual Certificateholder by virtue of this
paragraph will be treated as ordinary income or loss. The taxable income of the
REMIC will be determined under the rules described below in "--Taxable Income
of the REMIC" and will be taxable to the REMIC Residual Certificateholders
without regard to the timing or amount of cash distributions by the REMIC.
Ordinary income derived from REMIC Residual Certificates will be "portfolio
income" for purposes of the taxation of taxpayers subject to limitations under
Section 469 of the Code on the deductibility of "passive losses".
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A holder of a REMIC Residual Certificate that purchased such Certificate
from a prior holder of such Certificate also will be required to report on its
federal income tax return amounts representing its daily share of the taxable
income (or net loss) of the REMIC for each day that it holds such REMIC
Residual Certificate. Those daily amounts generally will equal the amounts of
taxable income or net loss determined as described above. The Committee Report
indicates that certain modifications of the general rules may be made, by
regulations, legislation or otherwise to reduce (or increase) the income of a
REMIC Residual Certificateholder that purchased such REMIC Residual Certificate
from a prior holder of such Certificate at a price greater than (or less than)
the adjusted basis (as defined below) such REMIC Residual Certificate would
have had in the hands of an original holder of such Certificate. The REMIC
Regulations, however, do not provide for any such modifications.
Any payments received by a holder of a REMIC Residual Certificate in
connection with the acquisition of such REMIC Residual Certificate will be
taken into account in determining the income of such holder for federal income
tax purposes. Although it appears likely that any such payment would be
includible in income immediately upon its receipt, the IRS might assert that
such payment should be included in income over time according to an
amortization schedule or according to some other method. Because of the
uncertainty concerning the treatment of such payments, holders of REMIC
Residual Certificates should consult their tax advisors concerning the
treatment of such payments for income tax purposes.
The amount of income REMIC Residual Certificateholders will be required to
report (or the tax liability associated with such income) may exceed the amount
of cash distributions received from the REMIC for the corresponding period.
Consequently, REMIC Residual Certificateholders should have other sources of
funds sufficient to pay any federal income taxes due as a result of their
ownership of REMIC Residual Certificates or unrelated deductions against which
income may be offset, subject to the rules relating to "excess inclusions",
residual interests without "significant value" and "noneconomic" residual
interests discussed below. The fact that the tax liability associated with the
income allocated to REMIC Residual Certificateholders may exceed the cash
distributions received by such REMIC Residual Certificateholders for the
corresponding period may significantly adversely affect such REMIC Residual
Certificateholders' after-tax rate of return.
Taxable Income of the REMIC. The taxable income of the REMIC will equal
the income from the Mortgage Loans and other assets of the REMIC plus any
cancellation of indebtedness income due to the allocation of realized losses to
REMIC Regular Certificates, less the deductions allowed to the REMIC for
interest (including original issue discount and reduced by any premium on
issuance) on the REMIC Regular Certificates (and any other class of REMIC
Certificates constituting "regular interests" in the REMIC not offered hereby),
amortization of any premium on the Mortgage Loans, bad debt losses with respect
to the Mortgage Loans and, except as described below, for servicing,
administrative and other expenses.
For purposes of determining its taxable income, the REMIC will have an
initial aggregate basis in its assets equal to the sum of the issue prices of
all REMIC Certificates (or, if a class of REMIC Certificates is not sold
initially, their fair market values). Such aggregate basis will be allocated
among the Mortgage Loans and the other assets of the REMIC in proportion to
their respective fair market values. The issue price of any REMIC Certificates
offered hereby will be determined in the manner described above under
"--Taxation of Owners of REMIC Regular Certificates--Original Issue Discount".
The issue price of a REMIC Certificate received in exchange for an interest in
the Mortgage Loans or other property will equal the fair market value of such
interests in the Mortgage Loans or other property. Accordingly, if one or more
classes of REMIC Certificates are retained initially rather than sold, the
Master Servicer or the Trustee may be required to estimate the fair market
value of such interests in order to determine the basis of the REMIC in the
Mortgage Loans and other property held by the REMIC.
Subject to possible application of the de minimis rules, the method of
accrual by the REMIC of original issue discount income and market discount
income with respect to Mortgage Loans that it holds will be equivalent to the
method for accruing original issue discount income for holders of REMIC Regular
Certificates (that is, under the constant yield method taking into account the
Prepayment
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Assumption). However, a REMIC that acquires loans at a market discount must
include such market discount in income currently, as it accrues, on a constant
yield basis. See "--Taxation of Owners of REMIC Regular Certificates" above,
which describes a method for accruing such discount income that is analogous to
that required to be used by a REMIC as to Mortgage Loans with market discount
that it holds.
A Mortgage Loan will be deemed to have been acquired with discount (or
premium) to the extent that the REMIC's basis therein, determined as described
in the preceding paragraph, is less than (or greater than) its stated
redemption price. Any such discount will be includible in the income of the
REMIC as it accrues, in advance of receipt of the cash attributable to such
income, under a method similar to the method described above for accruing
original issue discount on the REMIC Regular Certificates. It is anticipated
that each REMIC will elect under Section 171 of the Code to amortize any
premium on the Mortgage Loans. Premium on any Mortgage Loan to which such
election applies may be amortized under a constant yield method, presumably
taking into account a Prepayment Assumption. Further, such an election would
not apply to any Mortgage Loan originated on or before September 27, 1985.
Instead, premium on such a Mortgage Loan should be allocated among the
principal payments thereon and be deductible by the REMIC as those payments
become due or upon the prepayment of such Mortgage Loan.
A REMIC will be allowed deductions for interest (including original issue
discount) on the REMIC Regular Certificates (including any other class of REMIC
Certificates constituting "regular interests" in the REMIC not offered hereby)
equal to the deductions that would be allowed if the REMIC Regular Certificates
(including any other class of REMIC Certificates constituting "regular
interests" in the REMIC not offered hereby) were indebtedness of the REMIC.
Original issue discount will be considered to accrue for this purpose as
described above under "--Taxation of Owners of REMIC Regular
Certificates--Original Issue Discount", except that the de minimis rule and the
adjustments for subsequent holders of REMIC Regular Certificates (including any
other class of REMIC Certificates constituting "regular interests" in the REMIC
not offered hereby) described therein will not apply.
If a class of REMIC Regular Certificates is issued at a price in excess of
the stated redemption price of such class (such excess "Issue Premium"), the
net amount of interest deductions that are allowed the REMIC in each taxable
year with respect to the REMIC Regular Certificates of such class will be
reduced by an amount equal to the portion of the Issue Premium that is
considered to be amortized or repaid in that year. Although the matter is not
entirely certain, it is likely that Issue Premium would be amortized under a
constant yield method in a manner analogous to the method of accruing original
issue discount described above under "--Taxation of Owners of REMIC Regular
Certificates--Original Issue Discount".
As a general rule, the taxable income of a REMIC will be determined in the
same manner as if the REMIC were an individual having the calendar year as its
taxable year and using the accrual method of accounting. However, no item of
income, gain, loss or deduction allocable to a prohibited transaction will be
taken into account. See "--Prohibited Transactions Tax and Other Taxes" below.
Further, the limitation on miscellaneous itemized deductions imposed on
individuals by Section 67 of the Code (which allows such deductions only to the
extent they exceed in the aggregate two percent of the taxpayer's adjusted
gross income) will not be applied at the REMIC level so that the REMIC will be
allowed deductions for servicing, administrative and other non-interest
expenses in determining its taxable income. All such expenses will be allocated
as a separate item to the holders of REMIC Certificates, subject to the
limitation of Section 67 of the Code. See "--Possible Pass-Through of
Miscellaneous Itemized Deductions" below. If the deductions allowed to the
REMIC exceed its gross income for a calendar quarter, such excess will be the
net loss for the REMIC for that calendar quarter.
Basis Rules, Net Losses and Distributions. The adjusted basis of a REMIC
Residual Certificate will be equal to the amount paid for such REMIC Residual
Certificate, increased by amounts included in the income of the REMIC Residual
Certificateholder and decreased (but not below zero) by distributions made, and
by net losses allocated, to such REMIC Residual Certificateholder.
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A REMIC Residual Certificateholder is not allowed to take into account any
net loss for any calendar quarter to the extent such net loss exceeds such
REMIC Residual Certificateholder's adjusted basis in its REMIC Residual
Certificate as of the close of such calendar quarter (determined without regard
to such net loss). Any loss that is not currently deductible by reason of this
limitation may be carried forward indefinitely to future calendar quarters and,
subject to the same limitation, may be used only to offset income from the
REMIC Residual Certificate. The ability of REMIC Residual Certificateholders to
deduct net losses may be subject to additional limitations under the Code, as
to which REMIC Residual Certificateholders should consult their tax advisors.
Any distribution on a REMIC Residual Certificate will be treated as a
non-taxable return of capital to the extent it does not exceed the holder's
adjusted basis in such REMIC Residual Certificate. To the extent a distribution
on a REMIC Residual Certificate exceeds such adjusted basis, it will be treated
as gain from the sale of such REMIC Residual Certificate. Holders of certain
REMIC Residual Certificates may be entitled to distributions early in the term
of the related REMIC under circumstances in which their bases in such REMIC
Residual Certificates will not be sufficiently large that such distributions
will be treated as non-taxable returns of capital. Their bases in such REMIC
Residual Certificates will initially equal the amount paid for such REMIC
Residual Certificates and will be increased by their allocable shares of
taxable income of the REMIC. However, such bases increases may not occur until
the end of the calendar quarter, or perhaps the end of the calendar year, with
respect to which such REMIC taxable income is allocated to the REMIC Residual
Certificateholders. To the extent such REMIC Residual Certificateholders'
initial bases are less than the distributions to such REMIC Residual
Certificateholders, and increases in such initial bases either occur after such
distributions or (together with their initial bases) are less than the amount
of such distributions, gain will be recognized to such REMIC Residual
Certificateholders on such distributions and will be treated as gain from the
sale of their REMIC Residual Certificates.
The effect of these rules is that a REMIC Residual Certificateholder may
not amortize its basis in a REMIC Residual Certificate, but may only recover
its basis through distributions, through the deduction of any net losses of the
REMIC or upon the sale of its REMIC Residual Certificate. See "--Sales of REMIC
Certificates" below. For a discussion of possible modifications of these rules
that may require adjustments to income of a holder of a REMIC Residual
Certificate other than an original holder in order to reflect any difference
between the cost of such REMIC Residual Certificate to such REMIC Residual
Certificateholder and the adjusted basis such REMIC Residual Certificate would
have in the hands of an original holder see "--Taxation of Owners of REMIC
Residual Certificates--General" above.
Excess Inclusions. Any "excess inclusions" with respect to a REMIC
Residual Certificate will be subject to federal income tax in all events.
In general, the "excess inclusions" with respect to a REMIC Residual
Certificate for any calendar quarter will be the excess, if any, of (i) the
daily portions of REMIC taxable income allocable to such REMIC Residual
Certificate over (ii) the sum of the "daily accruals" (as defined below) for
each day during such quarter that such REMIC Residual Certificate was held by
such REMIC Residual Certificateholder. The daily accruals of a REMIC Residual
Certificateholder will be determined by allocating to each day during a
calendar quarter its ratable portion of the product of the "adjusted issue
price" of the REMIC Residual Certificate at the beginning of the calendar
quarter and 120% of the "long-term Federal rate" in effect on the Closing Date.
For this purpose, the adjusted issue price of a REMIC Residual Certificate as
of the beginning of any calendar quarter will be equal to the issue price of
the REMIC Residual Certificate, increased by the sum of the daily accruals for
all prior quarters and decreased (but not below zero) by any distributions made
with respect to such REMIC Residual Certificate before the beginning of such
quarter. The issue price of a REMIC Residual Certificate is the initial
offering price to the public (excluding bond houses and brokers) at which a
substantial amount of the REMIC Residual Certificates were sold. The "long-term
Federal rate" is an average of current yields on Treasury securities with a
remaining term of greater than nine years, computed and published monthly by
the IRS. Although it has not done so, the Treasury has authority to issue
regulations that would treat the entire amount of income accruing on a REMIC
Residual Certificate as an excess inclusion if the REMIC Residual Certificates
are considered not to have "significant value."
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For REMIC Residual Certificateholders, excess inclusions (i) will not be
permitted to be offset by deductions, losses or loss carryovers from other
activities, (ii) will be treated as "unrelated business taxable income" to an
otherwise tax-exempt organization and (iii) will not be eligible for any rate
reduction or exemption under any applicable tax treaty with respect to the 30%
United States withholding tax imposed on distributions to REMIC Residual
Certificateholders that are foreign investors. See, however, "--Foreign
Investors in REMIC Certificates" below. Furthermore, for purposes of the
alternative minimum tax, (i) excess inclusions will not be permitted to be
offset by the alternative tax net operating loss deduction and (ii) alternative
minimum taxable income may not be less than the taxpayer's excess inclusions.
The latter rule has the effect of preventing non-refundable tax credits from
reducing the taxpayer's income tax to an amount lower than the tentative
minimum tax on excess inclusions.
In the case of any REMIC Residual Certificates held by a real estate
investment trust, the aggregate excess inclusions with respect to such REMIC
Residual Certificates, reduced (but not below zero) by the real estate
investment trust taxable income (within the meaning of Section 857(b)(2) of the
Code, excluding any net capital gain), will be allocated among the shareholders
of such trust in proportion to the dividends received by such shareholders from
such trust, and any amount so allocated will be treated as an excess inclusion
with respect to a REMIC Residual Certificate as if held directly by such
shareholder. Treasury regulations yet to be issued could apply a similar rule
to regulated investment companies, common trust funds and certain cooperatives;
the REMIC Regulations currently do not address this subject.
Noneconomic REMIC Residual Certificates. Under the REMIC Regulations,
transfers of "noneconomic" REMIC Residual Certificates will be disregarded for
all federal income tax purposes if "a significant purpose of the transfer was
to enable the transferor to impede the assessment or collection of tax". If
such transfer is disregarded, the purported transferor will continue to remain
liable for any taxes due with respect to the income on such "noneconomic" REMIC
Residual Certificate. The REMIC Regulations provide that a REMIC Residual
Certificate is noneconomic unless, based on the Prepayment Assumption and on
any required or permitted clean up calls, or required liquidation provided for
in the REMIC's organizational documents, (1) the present value of the expected
future distributions (discounted using the "applicable Federal rate" for
obligations whose term ends on the close of the last quarter in which excess
inclusions are expected to accrue with respect to the REMIC Residual
Certificate, which rate is computed and published monthly by the IRS) on the
REMIC Residual Certificate equals at least the present value of the expected
tax on the anticipated excess inclusions, and (2) the transferor reasonably
expects that the transferee will receive distributions with respect to the
REMIC Residual Certificate at or after the time the taxes accrue on the
anticipated excess inclusions in an amount sufficient to satisfy the accrued
taxes. Accordingly, all transfers of REMIC Residual Certificates that may
constitute noneconomic residual interests will be subject to certain
restrictions under the terms of the related Pooling and Servicing Agreement
that are intended to reduce the possibility of any such transfer being
disregarded. Such restrictions will require each party to a transfer to provide
an affidavit that no purpose of such transfer is to impede the assessment or
collection of tax, including certain representations as to the financial
condition of the prospective transferee, as to which the transferor is also
required to make a reasonable investigation to determine such transferee's
historic payment of its debts and ability to continue to pay its debts as they
come due in the future. Prior to purchasing a REMIC Residual Certificate,
prospective purchasers should consider the possibility that a purported
transfer of such REMIC Residual Certificate by such a purchaser to another
purchaser at some future date may be disregarded in accordance with the
above-described rules which would result in the retention of tax liability by
such purchaser.
The related Prospectus Supplement will disclose whether offered REMIC
Residual Certificates may be considered "noneconomic" residual interests under
the REMIC Regulations; provided, however, that any disclosure that a REMIC
Residual Certificate will not be considered "noneconomic" will be based upon
certain assumptions, and the Depositor will make no representation that a REMIC
Residual Certificate will not be considered "noneconomic" for purposes of the
above-described rules. See "--Foreign Investors in REMIC Certificates--REMIC
Residual Certificates" below for additional restrictions applicable to
transfers of certain REMIC Residual Certificates to foreign persons.
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Mark-to-Market Rules. On December 23, 1996, the IRS released final
regulations (the "Mark-to-Market Regulations") relating to the requirement that
a securities dealer mark to market securities held for sale to customers. This
mark-to-market requirement applies to all securities owned by a dealer, except
to the extent that the dealer has specifically identified a security as held
for investment. The Mark-to-Market Regulations provide that, for purposes of
this mark-to-market requirement, a REMIC Residual Certificate is not treated as
a security and thus may not be marked to market.
Possible Pass-Through of Miscellaneous Itemized Deductions. Fees and
expenses of a REMIC generally will be allocated to the holders of the related
REMIC Residual Certificates. The applicable Treasury regulations indicate,
however, that in the case of a REMIC that is similar to a single class grantor
trust, all or a portion of such fees and expenses should be allocated to the
holders of the related REMIC Regular Certificates. Unless otherwise stated in
the related Prospectus Supplement, such fees and expenses will be allocated to
holders of the related REMIC Residual Certificates in their entirety and not to
the holders of the related REMIC Regular Certificates.
With respect to REMIC Residual Certificates or REMIC Regular Certificates
the holders of which receive an allocation of fees and expenses in accordance
with the preceding discussion, if any holder thereof is an individual, estate
or trust, or a "pass-through entity" beneficially owned by one or more
individuals, estates or trusts, (i) an amount equal to such individual's,
estate's or trust's share of such fees and expenses will be added to the gross
income of such holder and (ii) such individual's, estate's or trust's share of
such fees and expenses will be treated as a miscellaneous itemized deduction
allowable subject to the limitation of Section 67 of the Code, which permits
such deductions only to the extent they exceed in the aggregate two percent of
a taxpayer's adjusted gross income. In addition, Section 68 of the Code
provides that the amount of itemized deductions otherwise allowable for an
individual whose adjusted gross income exceeds a specified amount will be
reduced by the lesser of (i) 3% of the excess of the individual's adjusted
gross income over such amount or (ii) 80% of the amount of itemized deductions
otherwise allowable for the taxable year. The amount of additional taxable
income reportable by REMIC Certificateholders that are subject to the
limitations of either Section 67 or Section 68 of the Code may be substantial.
Furthermore, in determining the alternative minimum taxable income of such a
holder of a REMIC Certificate that is an individual, estate or trust, or a
"pass-through entity" beneficially owned by one or more individuals, estates or
trusts, no deduction will be allowed for such holder's allocable portion of
servicing fees and other miscellaneous itemized deductions of the REMIC, even
though an amount equal to the amount of such fees and other deductions will be
included in such holder's gross income. Accordingly, such REMIC Certificates
may not be appropriate investments for individuals, estates, or trusts, or
pass-through entities beneficially owned by one or more individuals, estates or
trusts. Such prospective investors should consult with their tax advisors prior
to making an investment in such Certificates.
Sales of REMIC Certificates. If a REMIC Certificate is sold, the selling
Certificateholder will recognize gain or loss equal to the difference between
the amount realized on the sale and its adjusted basis in the REMIC
Certificate. The adjusted basis of a REMIC Regular Certificate generally will
equal the cost of such REMIC Regular Certificate to such Certificateholder,
increased by income reported by such Certificateholder with respect to such
REMIC Regular Certificate (including original issue discount and market
discount income) and reduced (but not below zero) by distributions on such
REMIC Regular Certificate received by such Certificateholder and by any
amortized premium. The adjusted basis of a REMIC Residual Certificate will be
determined as described under "--Taxation of Owners of REMIC Residual
Certificates--Basis Rules, Net Losses and Distributions". Except as provided in
the following four paragraphs, any such gain or loss will be capital gain or
loss, provided such REMIC Certificate is held as a capital asset (generally,
property held for investment) within the meaning of Section 1221 of the Code.
The Code as of the date of this Prospectus provides for a top marginal tax rate
of 39.6% for individuals and a maximum marginal rate for long-term capital
gains of individuals of 28%. No such rate differential exists for corporations.
In addition, the distinction between a capital gain or loss and ordinary income
or loss remains relevant for other purposes.
Gain from the sale of a REMIC Regular Certificate that might otherwise be
capital gain will be treated as ordinary income to the extent such gain does
not exceed the excess, if any, of (i) the amount
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that would have been includible in the seller's income with respect to such
REMIC Regular Certificate assuming that income had accrued thereon at a rate
equal to 110% of the "applicable Federal rate" (generally, a rate based on an
average of current yields on Treasury securities having a maturity comparable
to that of the Certificate based on the application of the Prepayment
Assumption to such Certificate which rate is computed and published monthly by
the IRS), determined as of the date of purchase of such REMIC Regular
Certificate, over (ii) the amount of ordinary income actually includible in the
seller's income prior to such sale. In addition, gain recognized on the sale of
a REMIC Regular Certificate by a seller who purchased such REMIC Regular
Certificate at a market discount will be taxable as ordinary income in an
amount not exceeding the portion of such discount that accrued during the
period such REMIC Certificate was held by such holder, reduced by any market
discount included in income under the rules described above under "--Taxation
of Owners of REMIC Regular Certificates--Market Discount" and "--Premium".
REMIC Certificates will be "evidences of indebtedness" within the meaning
of Section 582(c)(1) of the Code, so that gain or loss recognized from the sale
of a REMIC Certificate by a bank or thrift institution to which such section
applies will be ordinary income or loss.
Except as may be provided in Treasury regulations yet to be issued, if the
seller of a REMIC Residual Certificate reacquires such REMIC Residual
Certificate, or acquires any other residual interest in a REMIC or any similar
interest in a "taxable mortgage pool" (as defined in Section 7701(i) of the
Code) during the period beginning six months before, and ending six months
after, the date of such sale, such sale will be subject to the "wash sale"
rules of Section 1091 of the Code. In that event, any loss realized by the
REMIC Residual Certificateholder on the sale will not be deductible, but
instead will be added to such REMIC Residual Certificateholder's adjusted basis
in the newly-acquired asset.
Prohibited Transactions Tax and Other Taxes. The Code imposes a tax on
REMICs equal to 100% of the net income derived from "prohibited transactions"
(a "Prohibited Transactions Tax"). In general, subject to certain specified
exceptions a prohibited transaction means the disposition of a Mortgage Loan,
the receipt of income from a source other than a Mortgage Loan or certain other
permitted investments, the receipt of compensation for services, or gain from
the disposition of an asset purchased with the payments on the Mortgage Loans
for temporary investment pending distribution on the REMIC Certificates. It is
not anticipated that any REMIC will engage in any prohibited transactions in
which it would recognize a material amount of net income.
In addition, certain contributions to a REMIC made after the day on which
the REMIC issues all of its interests could result in the imposition of a tax
on the REMIC equal to 100% of the value of the contributed property (a
"Contributions Tax"). Each Pooling and Servicing Agreement will include
provisions designed to prevent the acceptance of any contributions that would
be subject to such tax.
REMICs also are subject to federal income tax at the highest corporate
rate on "net income from foreclosure property", determined by reference to the
rules applicable to real estate investment trusts. "Net income from foreclosure
property" generally means gain from the sale of a foreclosure property that is
inventory property and gross income from foreclosure property other than
qualifying rents and other qualifying income for a real estate investment
trust. Unless otherwise disclosed in the related Prospectus Supplement, it is
not anticipated that any REMIC will recognize "net income from foreclosure
property" subject to federal income tax.
Unless otherwise disclosed in the related Prospectus Supplement, it is not
anticipated that any material state or local income or franchise tax will be
imposed on any REMIC.
Unless otherwise stated in the related Prospectus Supplement, and to the
extent permitted by then applicable laws, any Prohibited Transactions Tax,
Contributions Tax, tax on "net income from foreclosure property" or state or
local income or franchise tax that may be imposed on the REMIC will be borne by
the related Master Servicer, Special Servicer, Manager or Trustee in any case
out of its own funds, provided that such person has sufficient assets to do so,
and provided further that such tax arises out of a breach of such person's
obligations under the related Pooling and Servicing Agreement and in respect
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of compliance with applicable laws and regulations. Any such tax not borne by a
Master Servicer, Special Servicer, Manager or Trustee will be charged against
the related Trust Fund resulting in a reduction in amounts payable to holders
of the related REMIC Certificates.
Tax and Restrictions on Transfers of REMIC Residual Certificates to
Certain Organizations. If a REMIC Residual Certificate is transferred to a
"disqualified organization" (as defined below), a tax would be imposed in an
amount (determined under the REMIC Regulations) equal to the product of (i) the
present value (discounted using the "applicable Federal rate" for obligations
whose term ends on the close of the last quarter in which excess inclusions are
expected to accrue with respect to the REMIC Residual Certificate, which rate
is computed and published monthly by the IRS) of the total anticipated excess
inclusions with respect to such REMIC Residual Certificate for periods after
the transfer and (ii) the highest marginal federal income tax rate applicable
to corporations. The anticipated excess inclusions must be determined as of the
date that the REMIC Residual Certificate is transferred and must be based on
events that have occurred up to the time of such transfer, the Prepayment
Assumption and any required or permitted clean up calls or required liquidation
provided for in the REMIC's organizational documents. Such a tax generally
would be imposed on the transferor of the REMIC Residual Certificate, except
that where such transfer is through an agent for a disqualified organization,
the tax would instead be imposed on such agent. However, a transferor of a
REMIC Residual Certificate would in no event be liable for such tax with
respect to a transfer if the transferee furnishes to the transferor an
affidavit that the transferee is not a disqualified organization and, as of the
time of the transfer, the transferor does not have actual knowledge that such
affidavit is false. Moreover, an entity will not qualify as a REMIC unless
there are reasonable arrangements designed to ensure that (i) residual
interests in such entity are not held by disqualified organizations and (ii)
information necessary for the application of the tax described herein will be
made available. Restrictions on the transfer of REMIC Residual Certificates and
certain other provisions that are intended to meet this requirement will be
included in each Pooling and Servicing Agreement, and will be discussed in any
Prospectus Supplement relating to the offering of any REMIC Residual
Certificate.
In addition, if a "pass-through entity" (as defined below) includes in
income excess inclusions with respect to a REMIC Residual Certificate, and a
disqualified organization is the record holder of an interest in such entity,
then a tax will be imposed on such entity equal to the product of (i) the
amount of excess inclusions on the REMIC Residual Certificate that are
allocable to the interest in the pass-through entity held by such disqualified
organization and (ii) the highest marginal federal income tax rate imposed on
corporations. A pass-through entity will not be subject to this tax for any
period, however, if each record holder of an interest in such pass-through
entity furnishes to such pass-through entity (i) such holder's social security
number and a statement under penalties of perjury that such social security
number is that of the record holder or (ii) a statement under penalties of
perjury that such record holder is not a disqualified organization.
For these purposes, a "disqualified organization" means (i) the United
States, any State or political subdivision thereof, any foreign government, any
international organization, or any agency or instrumentality of the foregoing
(but would not include instrumentalities described in Section 168(h)(2)(D) of
the Code or the Federal Home Loan Mortgage Corporation), (ii) any organization
(other than a cooperative described in Section 521 of the Code) that is exempt
from federal income tax, unless it is subject to the tax imposed by Section 511
of the Code or (iii) any organization described in Section 1381(a)(2)(C) of the
Code. For these purposes, a "pass-through entity" means any regulated
investment company, real estate investment trust, trust, partnership or certain
other entities described in Section 860E(e)(6) of the Code. In addition, a
person holding an interest in a pass-through entity as a nominee for another
person will, with respect to such interest, be treated as a pass-through
entity.
Termination. A REMIC will terminate immediately after the Distribution
Date following receipt by the REMIC of the final payment in respect of the
Mortgage Loans or upon a sale of the REMIC's assets following the adoption by
the REMIC of a plan of complete liquidation. The last distribution on a REMIC
Regular Certificate will be treated as a payment in retirement of a debt
instrument. In the case of a REMIC Residual Certificate, if the last
distribution on such REMIC Residual Certificate is less than
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the REMIC Residual Certificateholder's adjusted basis in such Certificate, such
REMIC Residual Certificateholder should (but may not) be treated as realizing a
loss equal to the amount of such difference, and such loss may be treated as a
capital loss.
Reporting and Other Administrative Matters. Solely for purposes of the
administrative provisions of the Code, the REMIC will be treated as a
partnership and REMIC Residual Certificateholders will be treated as partners.
Unless otherwise stated in the related Prospectus Supplement, the Trustee or
the Master Servicer, which generally will hold at least a nominal amount of
REMIC Residual Certificates, will file REMIC federal income tax returns on
behalf of the related REMIC, and will be designated as and will act as the "tax
matters person" with respect to the REMIC in all respects.
As the tax matters person, the Trustee or the Master Servicer, as the case
may be, subject to certain notice requirements and various restrictions and
limitations, generally will have the authority to act on behalf of the REMIC
and the REMIC Residual Certificateholders in connection with the administrative
and judicial review of items of income, deduction, gain or loss of the REMIC,
as well as the REMIC's classification. REMIC Residual Certificateholders
generally will be required to report such REMIC items consistently with their
treatment on the related REMIC's tax return and may in some circumstances be
bound by a settlement agreement between the Trustee or the Master Servicer, as
the case may be, as tax matters person, and the IRS concerning any such REMIC
item. Adjustments made to the REMIC tax return may require a REMIC Residual
Certificateholder to make corresponding adjustments on its return, and an audit
of the REMIC's tax return, or the adjustments resulting from such an audit,
could result in an audit of a REMIC Residual Certificateholder's return. No
REMIC will be registered as a tax shelter pursuant to Section 6111 of the Code
because it is not anticipated that any REMIC will have a net loss for any of
the first five taxable years of its existence. Any person that holds a REMIC
Residual Certificate as a nominee for another person may be required to furnish
to the related REMIC, in a manner to be provided in Treasury regulations, the
name and address of such person and other information.
Reporting of interest income, including any original issue discount, with
respect to REMIC Regular Certificates is required annually, and may be required
more frequently under Treasury regulations. These information reports generally
are required to be sent to individual holders of REMIC Regular Interests and
the IRS; holders of REMIC Regular Certificates that are corporations, trusts,
securities dealers and certain other non-individuals will be provided interest
and original issue discount income information and the information set forth in
the following paragraph upon request in accordance with the requirements of the
applicable regulations. The information must be provided by the later of 30
days after the end of the quarter for which the information was requested, or
two weeks after the receipt of the request. The REMIC must also comply with
rules requiring a REMIC Regular Certificate issued with original issue discount
to disclose on its face the amount of original issue discount and the issue
date, and requiring such information to be reported to the IRS. Reporting with
respect to REMIC Residual Certificates, including income, excess inclusions,
investment expenses and relevant information regarding qualification of the
REMIC's assets will be made as required under the Treasury regulations,
generally on a quarterly basis.
As applicable, the REMIC Regular Certificate information reports will
include a statement of the adjusted issue price of the REMIC Regular
Certificate at the beginning of each accrual period. In addition, the reports
will include information required by regulations with respect to computing the
accrual of any market discount. Because exact computation of the accrual of
market discount on a constant yield method would require information relating
to the holder's purchase price that the REMIC may not have, such regulations
only require that information pertaining to the appropriate proportionate
method of accruing market discount be provided. See "--Taxation of Owners of
REMIC Regular Certificates--Market Discount".
Unless otherwise specified in the related Prospectus Supplement, the
responsibility for complying with the foregoing reporting rules will be borne
by either the Trustee or the Master Servicer.
Backup Withholding with Respect to REMIC Certificates. Payments of
interest and principal, as well as payments of proceeds from the sale of REMIC
Certificates, may be subject to the "backup withholding
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tax" under Section 3406 of the Code at a rate of 31% if recipients of such
payments fail to furnish to the payor certain information, including their
taxpayer identification numbers, or otherwise fail to establish an exemption
from such tax. Any amounts deducted and withheld from a distribution to a
recipient would be allowed as a credit against such recipient's federal income
tax. Furthermore, certain penalties may be imposed by the IRS on a recipient of
payments that is required to supply information but that does not do so in the
proper manner.
Foreign Investors in REMIC Certificates. A REMIC Regular Certificateholder
that is not a "United States Person" (as defined below) and is not subject to
federal income tax as a result of any direct or indirect connection to the
United States in addition to its ownership of a REMIC Regular Certificate will
not, unless otherwise disclosed in the related Prospectus Supplement, be
subject to United States federal income or withholding tax in respect of a
distribution on a REMIC Regular Certificate, provided that the holder complies
to the extent necessary with certain identification requirements (including
delivery of a statement, signed by the Certificateholder under penalties of
perjury, certifying that such Certificateholder is not a United States Person
and providing the name and address of such Certificateholder). For these
purposes, "United States Person" means a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in, or
under the laws of, the United States or any political subdivision thereof, or
an estate whose income is subject to United States income tax regardless of its
source, 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 fiduciaries have the authority to control all substantial decisions of
the trust. It is possible that the IRS may assert that the foregoing tax
exemption should not apply with respect to a REMIC Regular Certificate held by
a REMIC Residual Certificateholder that owns directly or indirectly a 10% or
greater interest in the REMIC Residual Certificates. If the holder does not
qualify for exemption, distributions of interest, including distributions in
respect of accrued original issue discount, to such holder may be subject to a
tax rate of 30%, subject to reduction under any applicable tax treaty.
In addition, the foregoing rules will not apply to exempt a United States
shareholder of a controlled foreign corporation from taxation on such United
States shareholder's allocable portion of the interest income received by such
controlled foreign corporation.
Further, it appears that a REMIC Regular Certificate would not be included
in the estate of a non-resident alien individual and would not be subject to
United States estate taxes. However, Certificateholders who are non-resident
alien individuals should consult their tax advisors concerning this question.
Unless otherwise stated in the related Prospectus Supplement, transfers of
REMIC Residual Certificates to investors that are not United States Persons
will be prohibited under the related Pooling and Servicing Agreement.
GRANTOR TRUST FUNDS
Classification of Grantor Trust Funds. With respect to each series of
Grantor Trust Certificates, counsel to the Depositor will deliver its opinion
to the effect that, assuming compliance with all provisions of the related
Pooling and Servicing Agreement, the related Grantor Trust Fund will be
classified as a grantor trust under subpart E, part I of subchapter J of the
Code and not as a partnership or an association taxable as a corporation.
Accordingly, each holder of a Grantor Trust Certificate generally will be
treated as the owner of an interest in the Mortgage Loans included in the
Grantor Trust Fund.
For purposes of the following discussion, a Grantor Trust Certificate
representing an undivided equitable ownership interest in the principal of the
Mortgage Loans constituting the related Grantor Trust Fund, together with
interest thereon at a pass-through rate, will be referred to as a "Grantor
Trust Fractional Interest Certificate". A Grantor Trust Certificate
representing ownership of all or a portion of the difference between interest
paid on the Mortgage Loans constituting the related Grantor Trust Fund (net of
normal administration fees) and interest paid to the holders of Grantor Trust
Fractional Interest
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Certificates issued with respect to such Grantor Trust Fund will be referred to
as a "Grantor Trust Strip Certificate". A Grantor Trust Strip Certificate may
also evidence a nominal ownership interest in the principal of the Mortgage
Loans constituting the related Grantor Trust Fund.
Taxation of Owners of Grantor Trust Fractional Interest Certificates.
General. Holders of a particular series of Grantor Trust Fractional
Interest Certificates generally will be required to report on their federal
income tax returns their shares of the entire income from the Mortgage Loans
(including amounts used to pay reasonable servicing fees and other expenses)
and will be entitled to deduct their shares of any such reasonable servicing
fees and other expenses. Because of stripped interests, market or original
issue discount, or premium, the amount includible in income on account of a
Grantor Trust Fractional Interest Certificate may differ significantly from the
amount distributable thereon representing interest on the Mortgage Loans. Under
Section 67 of the Code, an individual, estate or trust holding a Grantor Trust
Fractional Interest Certificate directly or through certain pass-through
entities will be allowed a deduction for such reasonable servicing fees and
expenses only to the extent that the aggregate of such holder's miscellaneous
itemized deductions exceeds two percent of such holder's adjusted gross income.
In addition, Section 68 of the Code provides that the amount of itemized
deductions otherwise allowable for an individual whose adjusted gross income
exceeds a specified amount will be reduced by the lesser of (i) 3% of the
excess of the individual's adjusted gross income over such amount or (ii) 80%
of the amount of itemized deductions otherwise allowable for the taxable year.
The amount of additional taxable income reportable by holders of Grantor Trust
Fractional Interest Certificates who are subject to the limitations of either
Section 67 or Section 68 of the Code may be substantial. Further,
Certificateholders (other than corporations) subject to the alternative minimum
tax may not deduct miscellaneous itemized deductions in determining such
holder's alternative minimum taxable income. Although it is not entirely clear,
it appears that in transactions in which multiple classes of Grantor Trust
Certificates (including Grantor Trust Strip Certificates) are issued, such fees
and expenses should be allocated among the classes of Grantor Trust
Certificates using a method that recognizes that each such class benefits from
the related services. In the absence of statutory or administrative
clarification as to the method to be used, it currently is intended to base
information returns or reports to the IRS and Certificateholders on a method
that allocates such expenses among classes of Grantor Trust Certificates with
respect to each period based on the distributions made to each such class
during that period.
The federal income tax treatment of Grantor Trust Fractional Interest
Certificates of any series will depend on whether they are subject to the
"stripped bond" rules of Section 1286 of the Code. Grantor Trust Fractional
Interest Certificates may be subject to those rules if (i) a class of Grantor
Trust Strip Certificates is issued as part of the same series of Certificates
or (ii) the Depositor or any of its affiliates retains (for its own account or
for purposes of resale) a right to receive a specified portion of the interest
payable on a Mortgage Asset. Further, the IRS has ruled that an unreasonably
high servicing fee retained by a seller or servicer will be treated as a
retained ownership interest in mortgages that constitutes a stripped coupon.
For purposes of determining what constitutes reasonable servicing fees for
various types of mortgages the IRS has established certain "safe harbors." The
servicing fees paid with respect to the Mortgage Loans for certain series of
Grantor Trust Certificates may be higher than the "safe harbors" and,
accordingly, may not constitute reasonable servicing compensation. The related
Prospectus Supplement will include information regarding servicing fees paid to
a Master Servicer, a Special Servicer, any Sub-Servicer or their respective
affiliates necessary to determine whether the preceding "safe harbor" rules
apply.
If Stripped Bond Rules Apply. If the stripped bond rules apply, each
Grantor Trust Fractional Interest Certificate will be treated as having been
issued with "original issue discount" within the meaning of Section 1273(a) of
the Code, subject, however, to the discussion below regarding the treatment of
certain stripped bonds as market discount bonds and the discussion regarding de
minimis market discount. See "--Taxation of Owners of Grantor Trust Fractional
Interest Certificates--Market Discount" below. Under the stripped bond rules,
the holder of a Grantor Trust Fractional Interest Certificate (whether a
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cash or accrual method taxpayer) will be required to report interest income
from its Grantor Trust Fractional Interest Certificate for each month in an
amount equal to the income that accrues on such Certificate in that month
calculated under a constant yield method, in accordance with the rules of the
Code relating to original issue discount.
The original issue discount on a Grantor Trust Fractional Interest
Certificate will be the excess of such Certificate's stated redemption price
over its issue price. The issue price of a Grantor Trust Fractional Interest
Certificate as to any purchaser will be equal to the price paid by such
purchaser of the Grantor Trust Fractional Interest Certificate. The stated
redemption price of a Grantor Trust Fractional Interest Certificate will be the
sum of all payments to be made on such Certificate, other than "qualified
stated interest", if any, as well as such Certificate's share of reasonable
servicing fees and other expenses. See "--Taxation of Owners of Grantor Trust
Fractional Interest Certificates--If Stripped Bond Rules Do Not Apply" for a
definition of "qualified stated interest". In general, the amount of such
income that accrues in any month would equal the product of such holder's
adjusted basis in such Grantor Trust Fractional Interest Certificate at the
beginning of such month (see "--Sales of Grantor Trust Certificates" below) and
the yield of such Grantor Trust Fractional Interest Certificate to such holder.
Such yield would be computed as the rate (compounded based on the regular
interval between payment dates) that, if used to discount the holder's share of
future payments on the Mortgage Loans, would cause the present value of those
future payments to equal the price at which the holder purchased such
Certificate. In computing yield under the stripped bond rules, a
Certificateholder's share of future payments on the Mortgage Loans will not
include any payments made in respect of any ownership interest in the Mortgage
Loans retained by the Depositor, a Master Servicer, a Special Servicer, any
Sub-Servicer or their respective affiliates, but will include such
Certificateholder's share of any reasonable servicing fees and other expenses.
Section 1272(a)(6) of the Code requires (i) the use of a reasonable
prepayment assumption in accruing original issue discount and (ii) adjustments
in the accrual of original issue discount when prepayments do not conform to
the prepayment assumption, with respect to certain categories of debt
instruments, and regulations could be adopted applying those provisions to the
Grantor Trust Fractional Interest Certificates. It is unclear whether those
provisions would be applicable to the Grantor Trust Fractional Interest
Certificates or whether use of a reasonable prepayment assumption may be
required or permitted without reliance on these rules. It is also uncertain, if
a prepayment assumption is used, whether the assumed prepayment rate would be
determined based on conditions at the time of the first sale of the Grantor
Trust Fractional Interest Certificate or, with respect to any holder, at the
time of purchase of the Grantor Trust Fractional Interest Certificate by that
holder. Certificateholders are advised to consult their tax advisors concerning
reporting original issue discount in general and, in particular, whether a
prepayment assumption should be used in reporting original issue discount with
respect to Grantor Trust Fractional Interest Certificates.
In the case of a Grantor Trust Fractional Interest Certificate acquired at
a price equal to the principal amount of the Mortgage Loans allocable to such
Certificate, the use of a prepayment assumption generally would not have any
significant effect on the yield used in calculating accruals of interest
income. In the case, however, of a Grantor Trust Fractional Interest
Certificate acquired at a discount or premium (that is, at a price less than or
greater than such principal amount, respectively), the use of a reasonable
prepayment assumption would increase or decrease such yield, and thus
accelerate or decelerate, respectively, the reporting of income.
If a prepayment assumption is not used, then when a Mortgage Loan prepays
in full, the holder of a Grantor Trust Fractional Interest Certificate acquired
at a discount or a premium generally will recognize ordinary income or loss
equal to the difference between the portion of the prepaid principal amount of
the Mortgage Loan that is allocable to such Certificate and the portion of the
adjusted basis of such Certificate that is allocable to such
Certificateholder's interest in the Mortgage Loan. If a prepayment assumption
is used, it appears that no separate item of income or loss should be
recognized upon a prepayment. Instead, a prepayment should be treated as a
partial payment of the stated redemption price of the Grantor Trust Fractional
Interest Certificate and accounted for under a method similar to that described
for taking account of original issue discount on REMIC Regular Certificates.
See
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"--REMICs--Taxation of Owners of REMIC Regular Certificates--Original Issue
Discount". It is unclear whether any other adjustments would be required to
reflect differences between an assumed prepayment rate and the actual rate of
prepayments.
In the absence of statutory or administrative clarification, it is
currently intended to base information reports or returns to the IRS and
Certificateholders in transactions subject to the stripped bond rules on a
prepayment assumption that will be disclosed in the related Prospectus
Supplement and on a constant yield computed using a representative initial
offering price for each class of Certificates. However, neither the Depositor
nor any other person will make any representation that the Mortgage Loans will
in fact prepay at a rate conforming to such prepayment assumption or any other
rate and Certificateholders should bear in mind that the use of a
representative initial offering price will mean that such information returns
or reports, even if otherwise accepted as accurate by the IRS, will in any
event be accurate only as to the initial Certificateholders of each series who
bought at that price.
Under Treasury regulation Section 1.1286-1(b), certain stripped bonds are
to be treated as market discount bonds and, accordingly, any purchaser of such
a bond is to account for any discount on the bond as market discount rather
than original issue discount. This treatment only applies, however, if
immediately after the most recent disposition of the bond by a person stripping
one or more coupons from the bond and disposing of the bond or coupon (i) there
is no original issue discount (or only a de minimis amount of original issue
discount) or (ii) the annual stated rate of interest payable on the original
bond is no more than one percentage point lower than the gross interest rate
payable on the original mortgage loan (before subtracting any servicing fee or
any stripped coupon). If interest payable on a Grantor Trust Fractional
Interest Certificate is more than one percentage point lower than the gross
interest rate payable on the Mortgage Loans, the related Prospectus Supplement
will disclose that fact. If the original issue discount or market discount on a
Grantor Trust Fractional Interest Certificate determined under the stripped
bond rules is less than 0.25% of the stated redemption price multiplied by the
weighted average maturity of the Mortgage Loans, then such original issue
discount or market discount will be considered to be de minimis. Original issue
discount or market discount of only a de minimis amount will be included in
income in the same manner as de minimis original issue and market discount
described in "--Taxation of Owners of Grantor Trust Fractional Interest
Certificates--If Stripped Bond Rules Do Not Apply" and "--Market Discount"
below.
If Stripped Bond Rules Do Not Apply. Subject to the discussion below on
original issue discount, if the stripped bond rules do not apply to a Grantor
Trust Fractional Interest Certificate, the Certificateholder will be required
to report its share of the interest income on the Mortgage Loans in accordance
with such Certificateholder's normal method of accounting. The original issue
discount rules will apply, even if the stripped bond rules do not apply, to a
Grantor Trust Fractional Interest Certificate to the extent it evidences an
interest in Mortgage Loans issued with original issue discount.
The original issue discount, if any, on the Mortgage Loans will equal the
difference between the stated redemption price of such Mortgage Loans and their
issue price. For a definition of "stated redemption price," see "--Taxation of
Owners of REMIC Regular Certificates--Original Issue Discount" above. In
general, the issue price of a Mortgage Loan will be the amount received by the
borrower from the lender under the terms of the Mortgage Loan, less any
"points" paid by the borrower, and the stated redemption price of a Mortgage
Loan will equal its principal amount, unless the Mortgage Loan provides for an
initial "teaser," or below-market interest rate. The determination as to
whether original issue discount will be considered to be de minimis will be
calculated using the same test as in the REMIC discussion. See "--Taxation of
Owners of REMIC Regular Certificates--Original Issue Discount" above.
In the case of Mortgage Loans bearing adjustable or variable interest
rates, the related Prospectus Supplement will describe the manner in which such
rules will be applied with respect to those Mortgage Loans by the Trustee or
Master Servicer, as applicable, in preparing information returns to the
Certificateholders and the IRS.
If original issue discount is in excess of a de minimis amount, all
original issue discount with respect to a Mortgage Loan will be required to be
accrued and reported in income each month, based on a constant yield. The OID
Regulations suggest that no prepayment assumption is appropriate in computing
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the yield on prepayable obligations issued with original issue discount. In the
absence of statutory or administrative clarification, it currently is not
intended to base information reports or returns to the IRS and
Certificateholders on the use of a prepayment assumption in transactions not
subject to the stripped bond rules. However, Section 1272(a)(6) of the Code may
require that a prepayment assumption be made in computing yield with respect to
all mortgage-backed securities. Certificateholders are advised to consult their
own tax advisors concerning whether a prepayment assumption should be used in
reporting original issue discount with respect to Grantor Trust Fractional
Interest Certificates. Certificateholders should refer to the related
Prospectus Supplement with respect to each series to determine whether and in
what manner the original issue discount rules will apply to Mortgage Loans in
such series.
A purchaser of a Grantor Trust Fractional Interest Certificate that
purchases such Grantor Trust Fractional Interest Certificate at a cost less
than such Certificate's allocable portion of the aggregate remaining stated
redemption price of the Mortgage Loans held in the related Trust Fund will also
be required to include in gross income such Certificate's daily portions of any
original issue discount with respect to such Mortgage Loans. However, each such
daily portion will be reduced, if the cost of such Grantor Trust Fractional
Interest Certificate to such purchaser is in excess of such Certificate's
allocable portion of the aggregate "adjusted issue prices" of the Mortgage
Loans held in the related Trust Fund, approximately in proportion to the ratio
such excess bears to such Certificate's allocable portion of the aggregate
original issue discount remaining to be accrued on such Mortgage Loans. The
adjusted issue price of a Mortgage Loan on any given day equals the sum of (i)
the adjusted issue price (or, in the case of the first accrual period, the
issue price) of such Mortgage Loan at the beginning of the accrual period that
includes such day and (ii) the daily portions of original issue discount for
all days during such accrual period prior to such day. The adjusted issue price
of a Mortgage Loan at the beginning of any accrual period will equal the issue
price of such Mortgage Loan, increased by the aggregate amount of original
issue discount with respect to such Mortgage Loan that accrued in prior accrual
periods, and reduced by the amount of any payments made on such Mortgage Loan
in prior accrual periods of amounts included in its stated redemption price.
Unless otherwise provided in the related Prospectus Supplement, the
Trustee or Master Servicer, as applicable, will provide to any holder of a
Grantor Trust Fractional Interest Certificate such information as such holder
may reasonably request from time to time with respect to original issue
discount accruing on Grantor Trust Fractional Interest Certificates. See
"--Grantor Trust Reporting" below.
Market Discount. If the stripped bond rules do not apply to a Grantor
Trust Fractional Interest Certificate, a Certificateholder may be subject to
the market discount rules of Sections 1276 through 1278 of the Code to the
extent an interest in a Mortgage Loan is considered to have been purchased at a
"market discount", that is, in the case of a Mortgage Loan issued without
original issue discount, at a purchase price less than its remaining stated
redemption price (as defined above), or in the case of a Mortgage Loan issued
with original issue discount, at a purchase price less than its adjusted issue
price (as defined above). If market discount is in excess of a de minimis
amount (as described below), the holder generally will be required to include
in income in each month the amount of such discount that has accrued (under the
rules described in the next paragraph) through such month that has not
previously been included in income, but limited, in the case of the portion of
such discount that is allocable to any Mortgage Loan, to the payment of stated
redemption price on such Mortgage Loan that is received by (or, in the case of
accrual basis Certificateholders, due to) the Trust Fund in that month. A
Certificateholder may elect to include market discount in income currently as
it accrues (under a constant yield method based on the yield of the Certificate
to such holder) rather than including it on a deferred basis in accordance with
the foregoing under rules similar to those described in "--Taxation of Owners
of REMIC Regular Interests--Market Discount" above.
Section 1276(b)(3) of the Code authorized the Treasury Department to issue
regulations providing for the method for accruing market discount on debt
instruments, the principal of which is payable in more than one installment.
Until such time as regulations are issued by the Treasury Department, certain
rules described in the Committee Report apply. Under those rules, in each
accrual period market discount on the Mortgage Loans should accrue, at the
holder's option: (i) on the basis of a constant yield method, (ii) in the case
of a Mortgage Loan issued without original issue discount, in an amount that
bears the
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same ratio to the total remaining market discount as the stated interest paid
in the accrual period bears to the total stated interest remaining to be paid
on the Mortgage Loan as of the beginning of the accrual period, or (iii) in the
case of a Mortgage Loan issued with original issue discount, in an amount that
bears the same ratio to the total remaining market discount as the original
issue discount accrued in the accrual period bears to the total original issue
discount remaining at the beginning of the accrual period. The prepayment
assumption, if any, used in calculating the accrual of original issue discount
is to be used in calculating the accrual of market discount. The effect of
using a prepayment assumption could be to accelerate the reporting of such
discount income. Because the regulations referred to in this paragraph have not
been issued, it is not possible to predict what effect such regulations might
have on the tax treatment of a Mortgage Loan purchased at a discount in the
secondary market.
Because the Mortgage Loans will provide for periodic payments of stated
redemption price, such discount may be required to be included in income at a
rate that is not significantly slower than the rate at which such discount
would be included in income if it were original issue discount.
Market discount with respect to Mortgage Loans may be considered to be de
minimis and, if so, will be includible in income under de minimis rules similar
to those described in "--REMICs--Taxation of Owners of REMIC Regular
Certificates--Original Issue Discount" above within the exception that it is
less likely that a prepayment assumption will be used for purposes of such
rules with respect to the Mortgage Loans.
Further, under the rules described in "--REMICs--Taxation of Owners of
REMIC Regular Certificates--Market Discount", any discount that is not original
issue discount and exceeds a de minimis amount may require the deferral of
interest expense deductions attributable to accrued market discount not yet
includible in income, unless an election has been made to report market
discount currently as it accrues.
Premium. If a Certificateholder is treated as acquiring the underlying
Mortgage Loans at a premium, that is, at a price in excess of their remaining
stated redemption price, such Certificateholder may elect under Section 171 of
the Code to amortize using a constant yield method the portion of such premium
allocable to Mortgage Loans originated after September 27, 1985. Amortizable
premium is treated as an offset to interest income on the related debt
instrument, rather than as a separate interest deduction. However, premium
allocable to Mortgage Loans originated before September 28, 1985 or to Mortgage
Loans for which an amortization election is not made, should be allocated among
the payments of stated redemption price on the Mortgage Loan and be allowed as
a deduction as such payments are made (or, for a Certificateholder using the
accrual method of accounting, when such payments of stated redemption price are
due).
It is unclear whether a prepayment assumption should be used in computing
amortization of premium allowable under Section 171 of the Code. If premium is
not subject to amortization using a prepayment assumption and a Mortgage Loan
prepays in full, the holder of a Grantor Trust Fractional Interest Certificate
acquired at a premium should recognize a loss equal to the difference between
the portion of the prepaid principal amount of the Mortgage Loan that is
allocable to the Certificate and the portion of the adjusted basis of the
Certificate that is allocable to the Mortgage Loan. If a prepayment assumption
is used to amortize such premium, it appears that such a loss would be
unavailable. Instead, if a prepayment assumption is used, a prepayment should
be treated as a partial payment of the stated redemption price of the Grantor
Trust Fractional Interest Certificate and accounted for under a method similar
to that described for taking account of original issue discount on REMIC
Regular Certificates. See "--REMICs--Taxation of Owners of REMIC Regular
Certificates--Original Issue Discount". It is unclear whether any other
adjustments would be required to reflect differences between the prepayment
assumption and the actual rate of prepayments.
Taxation of Owners of Grantor Trust Strip Certificates. The "stripped
coupon" rules of Section 1286 of the Code will apply to the Grantor Trust Strip
Certificates. Except as described above in "--Taxation of Owners of Grantor
Trust Fractional Interest Certificates--If Stripped Bond Rules Apply", no
regulations or published rulings under Section 1286 of the Code have been
issued and some uncertainty
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exists as to how it will be applied to securities such as the Grantor Trust
Strip Certificates. Accordingly, holders of Grantor Trust Strip Certificates
should consult their tax advisors concerning the method to be used in reporting
income or loss with respect to such Certificates.
The OID Regulations do not apply to "stripped coupons", although they
provide general guidance as to how the original issue discount sections of the
Code will be applied. In addition, the discussion below is subject to the
discussion under "--Possible Application of Proposed Contingent Payment Rules"
below and assumes that the holder of a Grantor Trust Strip Certificate will not
own any Grantor Trust Fractional Interest Certificates.
Under the stripped coupon rules, it appears that original issue discount
will be required to be accrued in each month on the Grantor Trust Strip
Certificates based on a constant yield method. In effect, each holder of
Grantor Trust Strip Certificates would include as interest income in each month
an amount equal to the product of such holder's adjusted basis in such Grantor
Trust Strip Certificate at the beginning of such month and the yield of such
Grantor Trust Strip Certificate to such holder. Such yield would be calculated
based on the price paid for that Grantor Trust Strip Certificate by its holder
and the payments remaining to be made thereon at the time of the purchase, plus
an allocable portion of the servicing fees and expenses to be paid with respect
to the Mortgage Loans. See "--Taxation of Owners of Grantor Trust Fractional
Interest Certificates--If Stripped Bond Rules Apply" above.
As noted above, Section 1272(a)(6) of the Code requires that a prepayment
assumption be used in computing the accrual of original issue discount with
respect to certain categories of debt instruments, and that adjustments be made
in the amount and rate of accrual of such discount when prepayments do not
conform to such prepayment assumption. Regulations could be adopted applying
those provisions to the Grantor Trust Strip Certificates. It is unclear whether
those provisions would be applicable to the Grantor Trust Strip Certificates or
whether use of a prepayment assumption may be required or permitted in the
absence of such regulations. It is also uncertain, if a prepayment assumption
is used, whether the assumed prepayment rate would be determined based on
conditions at the time of the first sale of the Grantor Trust Strip Certificate
or, with respect to any subsequent holder, at the time of purchase of the
Grantor Trust Strip Certificate by that holder.
The accrual of income on the Grantor Trust Strip Certificates will be
significantly slower if a prepayment assumption is permitted to be made than if
yield is computed assuming no prepayments. In the absence of statutory or
administrative clarification, it currently is intended to base information
returns or reports to the IRS and Certificateholders on the Prepayment
Assumption disclosed in the related Prospectus Supplement and on a constant
yield computed using a representative initial offering price for each class of
Certificates. However, neither the Depositor nor any other person will make any
representation that the Mortgage Loans will in fact prepay at a rate conforming
to the Prepayment Assumption or at any other rate and Certificateholders should
bear in mind that the use of a representative initial offering price will mean
that such information returns or reports, even if otherwise accepted as
accurate by the IRS, will in any event be accurate only as to the initial
Certificateholders of each series who bought at that price. Prospective
purchasers of the Grantor Trust Strip Certificates should consult their tax
advisors regarding the use of the Prepayment Assumption.
It is unclear under what circumstances, if any, the prepayment of a
Mortgage Loan will give rise to a loss to the holder of a Grantor Trust Strip
Certificate. If a Grantor Trust Strip Certificate is treated as a single
instrument (rather than an interest in discrete mortgage loans) and the effect
of prepayments is taken into account in computing yield with respect to such
Grantor Trust Strip Certificate, it appears that no loss may be available as a
result of any particular prepayment unless prepayments occur at a rate faster
than the Prepayment Assumption. However, if a Grantor Trust Strip Certificate
is treated as an interest in discrete Mortgage Loans, or if the Prepayment
Assumption is not used, then when a Mortgage Loan is prepaid, the holder of a
Grantor Trust Strip Certificate should be able to recognize a loss equal to the
portion of the adjusted issue price of the Grantor Trust Strip Certificate that
is allocable to such Mortgage Loan.
Possible Application of Proposed Contingent Payment Rules. The coupon
stripping rules' general treatment of stripped coupons is to regard them as
newly issued debt instruments in the hands of each
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purchaser. To the extent that payments on the Grantor Trust Strip Certificates
would cease if the Mortgage Loans were prepaid in full, the Grantor Trust Strip
Certificates could be considered to be debt instruments providing for
contingent payments. Under the OID Regulations, debt instruments providing for
contingent payments are not subject to the same rules as debt instruments
providing for noncontingent payments. Treasury regulations were promulgated on
June 11, 1996 regarding contingent payment debt instruments, but it appears
that the Grantor Trust Strip Certificates, due to their similarity to other
mortgage-backed securities (such as REMIC regular interests) that are expressly
exempted from the application of such proposed regulations, may be excepted
from such proposed regulations. Like the OID Regulations, such proposed
regulations do not specifically address securities, such as the Grantor Trust
Strip Certificates, that are subject to the stripped bond rules of Section 1286
of the Code.
If the contingent payment rules under the proposed regulations were to
apply, the holder of a Grantor Trust Strip Certificate would be required to
apply the "noncontingent bond method." Under the "noncontingent bond method,"
the issuer of a Grantor Trust Strip Certificate determines a projected payment
schedule on which interest will accrue. Holders of Grantor Trust Strip
Certificates are bound by the issuer's projected payment schedule. The
projected payment schedule consists of all noncontingent payments and a
projected amount for each contingent payment based on the "comparable yield"
(as described below) of the Grantor Trust Strip Certificate. The projected
amount of each payment is determined so that the payment schedule reflects the
"comparable yield." The projected amount of each payment must reasonably
reflect the relative expected values of the payments to be received by the
holders of a Grantor Trust Strip Certificate in the manner prescribed by the
regulations. The "comparable yield" referred to above is generally the yield at
which the issuer would issue a fixed rate debt instrument with terms and
conditions similar to those of the Grantor Trust Strip Certificates, including
the level of subordination, term, timing of payments and general market
conditions. The holder of a Grantor Trust Strip Certificate would be required
to include as interest income in each month the adjusted issue price of the
Grantor Trust Strip Certificate at the beginning of the period multiplied by
the projected yield.
Assuming that a prepayment assumption were used, if the proposed
regulations or their principles were applied to Grantor Trust Strip
Certificates, the amount of income reported with respect thereto would be
substantially similar to that described under "Taxation of Owners of Grantor
Trust Strip Certificates."
Certificateholders should consult their tax advisors concerning the
possible application of the contingent payment rules to the Grantor Trust Strip
Certificates.
Sales of Grantor Trust Certificates. Any gain or loss, equal to the
difference between the amount realized on the sale or exchange of a Grantor
Trust Certificate and its adjusted basis, recognized on such sale or exchange
of a Grantor Trust Certificate by an investor who holds such Grantor Trust
Certificate as a capital asset, will be capital gain or loss, except to the
extent of accrued and unrecognized market discount, which will be treated as
ordinary income, and (in the case of banks and other financial institutions)
except as provided under Section 582(c) of the Code. The adjusted basis of a
Grantor Trust Certificate generally will equal its cost, increased by any
income reported by the seller (including original issue discount and market
discount income) and reduced (but not below zero) by any previously reported
losses, any amortized premium and by any distributions with respect to such
Grantor Trust Certificate. The Code as of the date of this Prospectus provides
a top marginal tax rate of 39.6% for individuals and a maximum marginal rate
for long-term capital gains of individuals of 28%. No such rate differential
exists for corporations. In addition, the distinction between a capital gain or
loss and ordinary income or loss remains relevant for other purposes.
Gain or loss from the sale of a Grantor Trust Certificate may be partially
or wholly ordinary and not capital in certain circumstances. Gain attributable
to accrued and unrecognized market discount will be treated as ordinary income,
as will gain or loss recognized by banks and other financial institutions
subject to Section 582(c) of the Code. Furthermore, a portion of any gain that
might otherwise be capital gain may be treated as ordinary income to the extent
that the Grantor Trust Certificate is held as part of a "conversion
transaction" within the meaning of Section 1258 of the Code. A conversion
transaction generally is one in which the taxpayer has taken two or more
positions in the same or similar property that
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reduce or eliminate market risk, if substantially all of the taxpayer's return
is attributable to the time value of the taxpayer's net investment in such
transaction. The amount of gain realized in a conversion transaction that is
recharacterized as ordinary income generally will not exceed the amount of
interest that would have accrued on the taxpayer's net investment at 120% of
the appropriate "applicable Federal rate" (which rate is computed and published
monthly by the IRS) at the time the taxpayer enters into the conversion
transaction, subject to appropriate reduction for prior inclusion of interest
and other ordinary income items from the transaction.
Finally, a taxpayer may elect to have net capital gain taxed at ordinary
income rates rather than capital gains rates in order to include such net
capital gain in total net investment income for that taxable year, for purposes
of the rule that limits the deduction of interest on indebtedness incurred to
purchase or carry property held for investment to a taxpayer's net investment
income.
Grantor Trust Reporting. Unless otherwise provided in the related
Prospectus Supplement, the Trustee or Master Servicer, as applicable, will
furnish to each holder of a Grantor Trust Certificate with each distribution a
statement setting forth the amount of such distribution allocable to principal
on the underlying Mortgage Loans and to interest thereon at the related
Pass-Through Rate. In addition, the Trustee or Master Servicer, as applicable,
will furnish, within a reasonable time after the end of each calendar year, to
each holder of a Grantor Trust Certificate who was such a holder at any time
during such year, information regarding the amount of servicing compensation
received by the Master Servicer, the Special Servicer or any Sub-Servicer, and
such other customary factual information as the Depositor or the reporting
party deems necessary or desirable to enable holders of Grantor Trust
Certificates to prepare their tax returns and will furnish comparable
information to the IRS as and when required by law to do so. Because the rules
for accruing discount and amortizing premium with respect to the Grantor Trust
Certificates are uncertain in various respects, there is no assurance the IRS
will agree with the Trustee's or Master Servicer's, as the case may be,
information reports of such items of income and expense. Moreover, such
information reports, even if otherwise accepted as accurate by the IRS, will in
any event be accurate only as to the initial Certificateholders that bought
their Certificates at the representative initial offering price used in
preparing such reports.
Backup Withholding. In general, the rules described in "--REMICs--Backup
Withholding with Respect to REMIC Certificates" will also apply to Grantor
Trust Certificates.
Foreign Investors. In general, the discussion with respect to REMIC
Regular Certificates in "--REMICs--Foreign Investors in REMIC Certificates"
applies to Grantor Trust Certificates except that Grantor Trust Certificates
will, unless otherwise disclosed in the related Prospectus Supplement, be
eligible for exemption from U.S. withholding tax, subject to the conditions
described in such discussion, only to the extent the related Mortgage Loans
were originated after July 18, 1984.
To the extent that interest on a Grantor Trust Certificate would be exempt
under Sections 871(h)(1) and 881(c) of the Code from United States withholding
tax, and the Grantor Trust Certificate is not held in connection with a
Certificateholder's trade or business in the United States, such Grantor Trust
Certificate will not be subject to United States estate taxes in the estate of
a non-resident alien individual.
STATE AND OTHER TAX CONSEQUENCES
In addition to the federal income tax consequences described in "Certain
Federal Income Tax Consequences," potential investors should consider the state
and local tax consequences of the acquisition, ownership, and disposition of
the Offered Certificates. State tax law may differ substantially from the
corresponding federal law, and the discussion above does not purport to
describe any aspect of the income tax laws of any state or other jurisdiction.
Therefore, potential investors should consult their tax advisors with respect
to the various tax consequences of investments in the Offered Certificates.
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ERISA CONSIDERATIONS
GENERAL
ERISA and the Code impose certain requirements on employee benefit plans
and on certain other retirement plans and arrangements, including individual
retirement accounts and annuities, Keogh plans and collective investment funds
and separate accounts (and, as applicable, insurance company general accounts)
in which such plans, accounts or arrangements are invested that are subject to
the fiduciary responsibility provisions of ERISA and/or Section 4975 of the
Code ("Plans") and on persons who are fiduciaries with respect to such Plans in
connection with the investment of Plan assets. Certain employee benefit plans,
such as governmental plans (as defined in ERISA Section 3(32)), and, if no
election has been made under Section 410(d) of the Code, church plans (as
defined in Section 3(33) of ERISA) are not subject to ERISA requirements.
Accordingly, assets of such plans may be invested in Offered Certificates
without regard to the ERISA considerations described below, subject to the
provisions of other applicable federal and state law. Any such plan which is
qualified and exempt from taxation under Sections 401(a) and 501(a) of the
Code, however, is subject to the prohibited transaction rules set forth in
Section 503 of the Code.
ERISA generally imposes on Plan fiduciaries certain general fiduciary
requirements, including those of investment prudence and diversification and
the requirement that a Plan's investments be made in accordance with the
documents governing the Plan. In addition, Section 406 of ERISA and Section
4975 of the Code prohibit a broad range of transactions involving assets of a
Plan and persons ("Parties in Interest") who have certain specified
relationships to the Plan, unless a statutory or administrative exemption is
available. Unless an exemption is available, a Plan's purchase or holding of a
Certificate may constitute or result in a prohibited transaction if any of the
Depositor, the Trustee, the Master Servicer, the Manager, the Special Servicer
or a Sub-Servicer is a Party in Interest with respect to that Plan. Certain
Parties in Interest that participate in a prohibited transaction may be subject
to an excise tax imposed pursuant to Section 4975 of the Code or a penalty
imposed pursuant to Section 502(i) of ERISA, unless a statutory or
administrative exemption is available. These prohibited transactions generally
are set forth in Section 406 of ERISA and Section 4975 of the Code.
PLAN ASSET REGULATIONS
A Plan's investment in Offered Certificates may cause the underlying
Mortgage Loans, MBS and other assets included in a related Trust Fund to be
deemed assets of such Plan. A regulation of the United States Department of
Labor ("DOL") at 29 C.F.R. Section 2510.3-101 provides that when a Plan
acquires an equity interest in an entity, the Plan's assets include both such
equity interest and an undivided interest in each of the underlying assets of
the entity, unless certain exceptions not applicable here apply, or unless the
equity participation in the entity by "benefit plan investors" (i.e., Plans and
certain employee benefit plans not subject to ERISA) is not "significant," both
as defined therein. Equity participation in a Trust Fund will be significant on
any date if immediately after the most recent acquisition of any Certificate,
25% or more of any class of Certificates is held by benefit plan investors.
Any person who has discretionary authority or control respecting the
management or disposition of Plan assets, and any person who provides
investment advice with respect to such assets for a fee, is a fiduciary of the
investing Plan. If the Mortgage Loans, MBS and other assets included in a Trust
Fund constitute Plan assets, then any party exercising management or
discretionary control regarding those assets, such as the Master Servicer, the
Special Servicer, any Sub-Servicer, the Manager, the Trustee, the obligor under
any credit enhancement mechanism, or certain affiliates thereof may be deemed
to be a Plan "fiduciary" and thus subject to the fiduciary responsibility
provisions of ERISA and the prohibited transaction provisions of ERISA and
Section 4975 of the Code with respect to the investing Plan. In addition, if
the Mortgage Loans, MBS and other assets included in a Trust Fund constitute
Plan assets, the purchase of Certificates by, on behalf of or with assets of a
Plan, as well as the operation of the Trust Fund, may constitute or involve a
prohibited transaction under ERISA or the Code.
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PROHIBITED TRANSACTION EXEMPTION
On March 29, 1994, the DOL issued an individual exemption (the
"Exemption"), to certain of the Depositor's affiliates, which generally exempts
from the application of the prohibited transaction provisions of Section 406 of
ERISA, and the excise taxes imposed on such prohibited transactions pursuant to
Sections 4975(a) and (b) of the Code, certain transactions, among others,
relating to the servicing and operation of mortgage pools and the purchase,
sale and holding of mortgage pass-through certificates issued by a trust as to
which (i) the Depositor is the sponsor if any entity which has received from
the DOL an individual prohibited transaction exemption which is similar to the
Exemption is the sole underwriter, or manager or co-manager of the underwriting
syndicate or a seller or placement agent, or (ii) the Depositor or an affiliate
is the Underwriter (as hereinafter defined), provided that certain conditions
set forth in the Exemption are satisfied. For purposes of this Section "ERISA
Considerations," the term "Underwriter" shall include (a) the Depositor and
certain of its affiliates, (b) any person directly or indirectly, through one
or more intermediaries, controlling, controlled by or under common control with
the Depositor and certain of its affiliates, (c) any member of the underwriting
syndicate or selling group of which a person described in (a) or (b) is a
manager or co-manager with respect to a class of Certificates, or (d) any
entity which has received an exemption from the DOL relating to Certificates
which is similar to the Exemption.
The Exemption sets forth six general conditions which must be satisfied
for a transaction involving the purchase, sale and holding of Offered
Certificates to be eligible for exemptive relief thereunder. First, the
acquisition of Offered Certificates by or with assets of a Plan must be on
terms that are at least as favorable to the Plan as they would be in an
arm's-length transaction with an unrelated party. Second, the Exemption only
applies to Offered Certificates evidencing rights and interests that are not
subordinated to the rights and interests evidenced by the other Certificates of
the same trust. Third, the Offered Certificates at the time of acquisition by
or with assets of a Plan must be rated in one of the three highest generic
rating categories by Standard & Poor's Ratings Services, Moody's Investors
Service, Inc., Duff & Phelps Credit Rating Co. or Fitch IBCA, Inc. Fourth, the
Trustee cannot be an affiliate of any member of the "Restricted Group" which
consists of any Underwriter, the Depositor, the Master Servicer, any Special
Servicer, any Sub-Servicer, any obligor under any credit enhancement mechanism,
any Manager and any mortgagor with respect to Trust Assets constituting more
than 5% of the aggregate unamortized principal balance of the Trust Assets in
the related Trust Fund as of the date of initial issuance of the Certificates.
Fifth, the sum of all payments made to and retained by the Underwriters must
represent not more than reasonable compensation for underwriting the
Certificates; the sum of all payments made to and retained by the Depositor
pursuant to the assignment of the Trust Assets to the related Trust Fund must
represent not more than the fair market value of such obligations; and the sum
of all payments made to and retained by the Master Servicer, any Special
Servicer, any Sub-Servicer and any Manager must represent not more than
reasonable compensation for such person's services under the related Pooling
and Servicing Agreement and reimbursement of such person's reasonable expenses
in connection therewith. Sixth, the Exemption states that the investing Plan or
Plan asset investor must be an accredited investor as defined in Rule 501(a)(1)
of Regulation D of the Securities and Exchange Commission under the Securities
Act of 1933, as amended.
The Exemption also requires that each Trust Fund meet the following
requirements: (i) the Trust Fund must consist solely of assets of the type that
have been included in other investment pools; (ii) certificates in such other
investment pools must have been rated in one of the three highest categories of
one of the rating agencies specified above for at least one year prior to the
acquisition of Certificates by or with assets of a Plan; and (iii) certificates
in such other investment pools must have been purchased by investors other than
Plans for at least one year prior to any acquisition of Certificates by or with
assets of a Plan.
It is not clear whether certain Certificates that may be offered hereunder
would constitute "certificates" for purposes of the Exemption, including but
not limited to, (i) Certificates evidencing an interest in certificates insured
or guaranteed by FAMC, (ii) Certificates evidencing an interest in Mortgage
Loans secured by liens on real estate projects under construction, (iii)
Certificates evidencing an interest in a Trust Fund including equity
participations, (iv) Certificates evidencing an interest in a Trust Fund
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including Cash Flow Agreements, or (v) subordinated Classes of Certificates
(collectively, "Non-Exempt Certificates"). In promulgating the Exemption, the
DOL did not have under consideration interests in pools of the exact nature
described in this paragraph and accordingly, unless otherwise provided in the
related Prospectus Supplement, Plans and persons investing assets of Plans
should not purchase Non-Exempt Certificates based solely upon the Exemption.
A fiduciary or other investor of Plan assets contemplating purchasing an
Offered Certificate must make its own determination that the general conditions
set forth above will be satisfied with respect to such Certificate.
If the general conditions of the Exemption are satisfied, the Exemption
may provide an exemption from the restrictions imposed by Sections 406(a) and
407 of ERISA, and the excise taxes imposed by Sections 4975(a) and (b) of the
Code by reason of Sections 4975(c)(1)(A) through (D) of the Code, in connection
with the direct or indirect sale, exchange, transfer, holding or the direct or
indirect acquisition or disposition in the secondary market of Offered
Certificates by or with assets of a Plan. However, no exemption is provided
from the restrictions of Sections 406(a)(1)(E) and 406(a)(2) of ERISA for the
acquisition or holding of an Offered Certificate on behalf of an "Excluded
Plan" by any person who has discretionary authority or renders investment
advice with respect to assets of such Excluded Plan. For purposes of the
Certificates, an Excluded Plan is a Plan sponsored by any member of the
Restricted Group.
If certain specific conditions of the Exemption are also satisfied, the
Exemption may provide an exemption from the restrictions imposed by Sections
406(b)(1) and (b)(2) of ERISA, and the taxes imposed by Sections 4975(a) and
(b) of the Code by reason of Section 4975(c)(1)(E) of the Code, in connection
with (1) the direct or indirect sale, exchange or transfer of Certificates in
the initial issuance of Certificates between the Depositor or an Underwriter
and a Plan when the person who has discretionary authority or renders
investment advice with respect to the investment of the relevant Plan assets in
the Certificates is (a) a mortgagor with respect to 5% or less of the fair
market value of the Trust Assets or (b) an affiliate of such a person, (2) the
direct or indirect acquisition or disposition in the secondary market of
Certificates by or with assets of a Plan and (3) the holding of Certificates by
or with assets of a Plan.
Further, if certain specific conditions of the Exemption are satisfied,
the Exemption may provide an exemption from the restrictions imposed by
Sections 406(a), 406(b) and 407 of ERISA, and the taxes imposed by Sections
4975(a) and (b) of the Code by reason of Section 4975(c) of the Code, for
transactions in connection with the servicing, management and operation of the
pools of Mortgage Assets. The Depositor expects that the specific conditions of
the Exemption required for this purpose will be satisfied with respect to the
Certificates so that the Exemption would provide an exemption from the
restrictions imposed by Sections 406(a) and (b) of ERISA, the excise taxes
imposed by Sections 4975(a) and (b) of the Code by reason of Section 4975(c) of
the Code), for transactions in connection with the servicing, management and
operation of the pools of Mortgage Assets, provided that the general conditions
of the Exemption are satisfied.
The Exemption also may provide an exemption from the restrictions imposed
by Sections 406(a) and 407(a) of ERISA, and the taxes imposed by Sections
4975(a) and (b) of the Code by reason of Sections 4975(c)(1)(A) through (D) of
the Code, if such restrictions are deemed to otherwise apply merely because a
person is deemed to be a "party in interest" (within the meaning of Section
3(14) of ERISA) or a "disqualified person" (within the meaning of Section
4975(e)(2) of the Code) with respect to an investing Plan by virtue of
providing services to the Plan (or by virtue of having certain specified
relationships to such a person) solely as a result of the Plan's ownership of
Certificates.
Before purchasing an Offered Certificate, a fiduciary or other investor of
Plan assets should itself confirm (a) that the Certificates constitute
"certificates" for purposes of the Exemption and (b) that the specific and
general conditions set forth in the Exemption and the other requirements set
forth in the Exemption would be satisfied. In addition to making its own
determination as to the availability of the exemptive relief provided in the
Exemption, the fiduciary or other Plan investor should consider its general
fiduciary obligations under ERISA in determining whether to purchase any
Offered Certificates
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with assets of a Plan. Such fiduciary or other Plan investor should consider
the availability of other class exemptions granted by the DOL, which provide
relief from certain of the prohibited transaction provisions of ERISA and the
related excise tax provisions of Section 4975 of the Code, including Sections I
and III of Prohibited Transaction Class Exemption ("PTCE") 95-60, regarding
transactions by insurance company general accounts. The Prospectus Supplement
with respect to a series of Certificates may contain additional information
regarding the application of the Exemption, PTCE 95-60 or any other DOL
exemption, with respect to the Certificates offered thereby.
Any fiduciary or other Plan investor that proposes to purchase Offered
Certificates on behalf of or with assets of a Plan should consult with its
counsel with respect to the potential applicability of ERISA and the Code to
such investment and the availability of the Exemption or any other prohibited
transaction exemption in connection therewith. There can be no assurance that
any of these exemptions will apply with respect to any particular Plan's or
other Plan asset investor's investment in the Certificates or, even if an
exemption were deemed to apply, that any exemption would apply to all
prohibited transactions that may occur in connection with such an investment.
INSURANCE COMPANY GENERAL ACCOUNTS
In addition to any exemption that may be available under PTCE 95-60 for
the purchase and holding of the Certificates by an insurance company general
account, the Small Business Job Protection Act of 1996 added a new Section
401(c) to ERISA, which provides certain exemptive relief from the provisions of
Part 4 of Title I of ERISA and Section 4975 of the Code, including the
prohibited transaction restrictions imposed by ERISA and the related excise
taxes imposed by Section 4975 of the Code, for transactions involving an
insurance company general account. Pursuant to Section 401(c) of ERISA, the DOL
is required to issue final regulations (the "401(c) Regulations") no later than
December 31, 1997 which are to provide guidance for the purpose of determining,
in cases where insurance policies and annuity contracts supported by an
insurer's general account are issued to or for the benefit of a Plan on or
before December 31, 1998, which general account assets constitute Plan assets.
Section 401(c) of ERISA generally provides that, until the date which is 18
months after the 401(c) Regulations become final, no person shall be subject to
liability under Part 4 of Title I of ERISA and Section 4975 of the Code on the
basis of a claim that the assets of an insurance company general account
constitute Plan assets, unless (I) as otherwise provided by the Secretary of
labor in the 401(c) Regulations to prevent avoidance of the regulations or (ii)
an action is brought by the Secretary of labor for certain breaches of
fiduciary duty which would also constitute a violation of federal or state
criminal law. Any assets of an insurance company general account which support
insurance policies or annuity contracts issued to a Plan after December 31,
1998 or issued to Plans on or before December 31, 1998 for which the insurance
company does not comply with the 401(c) Regulations may be treated as Plan
assets. In addition, because Section 401(c) does not relate to insurance
company accounts, separate account assets are still treated as Plan assets of
any Plan invested in such separate account. Insurance companies contemplating
the investment of general account assets in the Certificates should consult
with their legal counsel with respect to the applicability of Sections I and
III of PTCE 95-60 and Section 401(c) of ERISA, including the general account's
ability to continue to hold the Certificates after the date which is 18 months
after the date the 401(c) Regulations become final.
REPRESENTATION FROM INVESTING PLANS
It is not clear whether the exemptive relief afforded by the Exemption
will be applicable to the purchase, sale or holding of any class of Non-Exempt
Certificates. To the extent that Offered Certificates are Non-Exempt
Certificates, transfers of such Certificates to a Plan, to a trustee or other
person acting on behalf of any Plan, or to any other person using Plan assets
to effect such acquisition will not be registered by the Trustee unless the
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, which opinion will not be at the expense of the Depositor, the
Trustee or the Master Servicer, that the purchase of such Certificates by or on
behalf of, or with asset of, any Plan is permissible under applicable law, will
not constitute or result in any non-exempt prohibited transaction under ERISA
or Section 4975
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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 Pooling and
Servicing Agreement. In lieu of such opinion of counsel, the prospective
transferee of any class of Non-Exempt Certificates may provide a certification
of facts substantially to the effect that the purchase of such Certificates by
or on behalf of, or with asset of, any Plan is permissible under applicable
law, will not constitute or result in a 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
Pooling and Servicing Agreement, and the following conditions are met: (a) the
source of funds used to purchase such Certificates 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.
TAX EXEMPT INVESTORS
A Plan that is exempt from federal income taxation pursuant to Section 501
of the Code (a "Tax Exempt Investor") nonetheless will be subject to federal
income taxation to the extent that its income is "unrelated business taxable
income" ("UBTI") within the meaning of Section 512 of the Code. All "excess
inclusions" of a REMIC allocated to a REMIC Residual Certificate held by a
Tax-Exempt Investor will be considered UBTI and thus will be subject to federal
income tax. See "Certain Federal Income Tax Consequences--Taxation of Owners of
REMIC Residual Certificates--Excess Inclusions."
Such fiduciary or other Plan investor should consider the availability of
other class exemptions granted by the DOL, which provide relief from certain of
the prohibited transaction provisions of ERISA and the related excise tax
provisions of Section 4975 of the Code, including Sections I and III of
Prohibited Transaction Class Exemption ("PTCE") 95-60, regarding transactions
by insurance company general accounts. The Prospectus Supplement with respect
to a series of Certificates may contain additional information regarding the
application of the Exemption, PTCE 95-60 or any other DOL exemption, with
respect to the Certificates offered thereby.
LEGAL INVESTMENT
If so specified in the related Prospectus Supplement, the Offered
Certificates will constitute "mortgage related securities" for purposes of
SMMEA. Accordingly, investors whose investment authority is subject to legal
restrictions should consult their legal advisors to determine whether and to
what extent the Offered Certificates constitute legal investments for them.
Generally, only classes of Offered Certificates that (i) are rated in one
of the two highest rating categories by one or more Rating Agencies and (ii)
are part of a series evidencing interests in a Trust Fund consisting of loans
secured by a single parcel of real estate upon which is located a dwelling or
mixed residential and commercial structure, such as certain Multifamily Loans,
and originated by types of Originators specified in SMMEA, will be "mortgage
related securities" for purposes of SMMEA. "Mortgage related securities" are
legal investments to the same extent that, under applicable law, obligations
issued by or guaranteed as to principal and interest by the United States or
any agency or instrumentality thereof constitute legal investments for persons,
trusts, corporations, partnerships, associations, business trusts and business
entities (including depository institutions, insurance companies and pension
funds created pursuant to or existing under the laws of the United States or of
any state, the authorized investments of which are subject to state
regulation). Under SMMEA, if a state enacted legislation prior to October 3,
1991 that specifically limits the legal investment authority of any such
entities with respect to "mortgage related securities", Offered Certificates
would constitute legal investments for entities subject to such legislation
only to the extent provided in such legislation.
SMMEA also amended the legal investment authority of federally chartered
depository institutions as follows: federal savings and loan associations and
federal savings banks may invest in, sell or otherwise deal with "mortgage
related securities" without limitation as to the percentage of their assets
represented
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thereby, federal credit unions may invest in such securities, and national
banks may purchase such securities for their own account without regard to the
limitations generally applicable to investment securities set forth in 12
U.S.C. 24 (Seventh), subject in each case to such regulations as the applicable
federal regulatory authority may prescribe.
Upon the issuance of final implementing regulations under the Riegle
Community Development and Regulatory Improvement Act of 1994 and subject to any
limitations such regulations may impose, a modification of the definition of
"mortgage related securities" will become effective to expand the types of
loans to which such securities may relate to include loans secured by "one or
more parcels of real estate upon which is located one or more commercial
structures". In addition, the related legislative history states that this
expanded definition includes multifamily residential loans secured by more than
one parcel of real estate upon which is located more than one structure. Until
September 23, 2001 any state may enact legislation limiting the extent to which
"mortgage related securities" under this expanded definition would constitute
legal investments under that state's laws.
The Federal Financial Institutions Examination Council has issued a
supervisory policy statement (the "Policy Statement") applicable to all
depository institutions, setting forth guidelines for and significant
restrictions on investments in "high-risk mortgage securities". The Policy
Statement has been adopted by the Federal Reserve Board, the Office of the
Comptroller of the Currency, the FDIC and the OTS. The Policy Statement
generally indicates that a mortgage derivative product will be deemed to be
high risk if it exhibits greater price volatility than a standard fixed rate
thirty-year mortgage security. According to the Policy Statement, prior to
purchase, a depository institution will be required to determine whether a
mortgage derivative product that it is considering acquiring is high-risk, and
if so that the proposed acquisition would reduce the institution's overall
interest rate risk. Reliance on analysis and documentation obtained from a
securities dealer or other outside party without internal analysis by the
institution would be unacceptable. There can be no assurance as to which
classes of Certificates, including Offered Certificates, will be treated as
high-risk under the Policy Statement.
The predecessor to the Office of Thrift Supervision (the "OTS") issued a
bulletin, entitled, "Mortgage Derivative Products and Mortgage Swaps", which is
applicable to thrift institutions regulated by the OTS. The bulletin
established guidelines for the investment by savings institutions in certain
"high-risk" mortgage derivative securities and limitations on the use of such
securities by insolvent, undercapitalized or otherwise "troubled" institutions.
According to the bulletin, such "high-risk" mortgage derivative securities
include securities having certain specified characteristics, which may include
certain classes of Offered Certificates. In addition, the National Credit Union
Administration has issued regulations governing federal credit union
investments which prohibit investment in certain specified types of securities,
which may include certain classes of Offered Certificates. Similar policy
statements have been issued by regulators having jurisdiction over other types
of depository institutions.
There may be other restrictions on the ability of certain investors either
to purchase certain classes of Offered Certificates or to purchase any class of
Offered Certificates representing more than a specified percentage of the
investor's assets. The Depositor will make no representations as to the proper
characterization of any class of Offered Certificates for legal investment or
other purposes, or as to the ability of particular investors to purchase any
class of Offered Certificates under applicable legal investment restrictions.
These uncertainties may adversely affect the liquidity of any class of Offered
Certificates. Accordingly, all investors whose investment activities are
subject to legal investment laws and regulations, regulatory capital
requirements or review by regulatory authorities should consult with their
legal advisors in determining whether and to what extent the Offered
Certificates of any class constitute legal investments or are subject to
investment, capital or other restrictions.
USE OF PROCEEDS
The net proceeds to be received from the sale of the Certificates of any
series will be applied by the Depositor to the purchase of Trust Assets or will
be used by the Depositor for general corporate purposes. The Depositor expects
to sell the Certificates from time to time, but the timing and amount of
offerings of Certificates will depend on a number of factors, including the
volume of Mortgage Assets acquired by the Depositor, prevailing interest rates,
availability of funds and general market conditions.
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METHOD OF DISTRIBUTION
The Certificates offered hereby and by the related Prospectus Supplements
will be offered in series through one or more of the methods described below.
The Prospectus Supplement prepared for each series will describe the method of
offering being utilized for that series and will state the net proceeds to the
Depositor from such sale.
The Depositor intends that Offered Certificates will be offered through
the following methods from time to time and that offerings may be made
concurrently through more than one of these methods or that an offering of the
Offered Certificates of a particular series may be made through a combination
of two or more of these methods. Such methods are as follows:
1. By negotiated firm commitment or best efforts underwriting and public
re-offering by underwriters;
2. By placements by the Depositor with institutional investors through
dealers; and
3. By direct placements by the Depositor with institutional investors.
In addition, if specified in the related Prospectus Supplement, the
Offered Certificates of a series may be offered in whole or in part to the
seller of the related Mortgage Assets that would comprise the Trust Fund for
such Certificates.
If underwriters are used in a sale of any Offered Certificates (other than
in connection with an underwriting on a best efforts basis), such Certificates
will be acquired by the underwriters for their own account and may be resold
from time to time in one or more transactions, including negotiated
transactions, at fixed public offering prices or at varying prices to be
determined at the time of sale or at the time of commitment therefor. Such
underwriters may be broker-dealers affiliated with the Depositor whose
identities and relationships to the Depositor will be as set forth in the
related Prospectus Supplement. The Depositor or the underwriters may sell
certain of the Certificates to affiliates of the Depositor. In any such case,
the related Prospectus Supplement will identify any such affiliate and the
method or methods by which such affiliate may resell such Certificates. The
managing underwriter or underwriters with respect to the offer and sale of
Offered Certificates of a particular series will be set forth on the cover of
the Prospectus Supplement relating to such series and the members of the
underwriting syndicate, if any, will be named in such Prospectus Supplement.
In connection with the sale of Offered Certificates, underwriters may
receive compensation from the Depositor or from purchasers of the Offered
Certificates in the form of discounts, concessions or commissions. Underwriters
and dealers participating in the distribution of the Offered Certificates may
be deemed to be underwriters in connection with such Certificates, and any
discounts or commissions received by them from the Depositor and any profit on
the resale of Offered Certificates by them may be deemed to be underwriting
discounts and commissions under the Securities Act of 1933, as amended.
It is anticipated that the underwriting agreement pertaining to the sale
of the Offered Certificates of any series will provide that the obligations of
the underwriters will be subject to certain conditions precedent, that the
underwriters will be obligated to purchase all such Certificates if any are
purchased (other than in connection with an underwriting on a best efforts
basis) and that, in limited circumstances, the Depositor will indemnify the
several underwriters and the underwriters will indemnify the Depositor against
certain civil liabilities, including liabilities under the Securities Act of
1933, as amended, or will contribute to payments required to be made in respect
thereof.
The Prospectus Supplement with respect to any series offered by placements
through dealers will contain information regarding the nature of such offering
and any agreements to be entered into between the Depositor and purchasers of
Offered Certificates of such series.
The Depositor anticipates that the Certificates offered hereby will be
sold primarily to institutional investors. Purchasers of Offered Certificates,
including dealers, may, depending on the facts and circumstances of such
purchases, be deemed to be "underwriters" within the meaning of the Securities
Act of 1933, as amended, in connection with reoffers and sales by them of
Offered Certificates. Holders of Offered Certificates should consult with their
legal advisors in this regard prior to any such reoffer or sale.
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LEGAL MATTERS
Unless otherwise specified in the related Prospectus Supplement, certain
legal matters in connection with the Certificates of each series, including
certain federal income tax consequences, will be passed upon for the Depositor
by Mayer, Brown & Platt, Chicago, Illinois, Thacher Proffitt & Wood, New York,
New York or Orrick, Herrington & Sutcliffe LLP, New York, New York.
FINANCIAL INFORMATION
A new Trust Fund will be formed with respect to each series of
Certificates, and no Trust Fund will engage in any business activities or have
any assets or obligations prior to the issuance of the related series of
Certificates. Accordingly, no financial statements with respect to any Trust
Fund will be included in this Prospectus or in the related Prospectus
Supplement. The Depositor has determined that its financial statements will not
be material to the offering of any Offered Certificates.
RATING
It is a condition to the issuance of any class of Offered Certificates
that they shall have been rated not lower than investment grade, that is, in
one of the four highest rating categories, by at least one Rating Agency.
Ratings on mortgage pass-through certificates address the likelihood of
receipt by the holders thereof of all collections on the underlying mortgage
assets to which such holders are entitled. These ratings address the
structural, legal and issuer-related aspects associated with such certificates,
the nature of the underlying mortgage assets and the credit quality of the
guarantor, if any. Ratings on mortgage pass-through certificates do not
represent any assessment of the likelihood of principal prepayments by
borrowers or of the degree by which such prepayments might differ from those
originally anticipated. As a result, certificateholders might suffer a lower
than anticipated yield, and, in addition, holders of stripped interest
certificates in extreme cases might fail to recoup their initial investments.
Furthermore, ratings on mortgage pass-through certificates do not address the
price of such certificates or the suitability of such certificates to the
investor.
A security rating is not a recommendation to buy, sell or hold securities
and may be subject to revision or withdrawal at any time by the assigning
rating organization. Each security rating should be evaluated independently of
any other security rating.
88
<PAGE>
INDEX OF PRINCIPAL TERMS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
401(c) Regulations ..................................... 84
Accrual Certificates ................................... 8
Accrued Certificate Interest ........................... 26
Act .................................................... 54
Annual Debt Service .................................... 15
ARM Loans .............................................. 17
Available Distribution Amount .......................... 25
Book-Entry Certificates ................................ 25
Cash Flow Agreement .................................... 9
CERCLA ................................................. 54
Certificate Account .................................... 18
Certificate Balance .................................... 7
Certificate Owner ...................................... 31
Certificateholder ...................................... 31
Certificates ........................................... 1
Closing Date ........................................... 60
Code ................................................... 10
Commercial Properties .................................. 14
Commission ............................................. 3
Committee Report ....................................... 59
Companion Class ........................................ 27
Condemnation Proceeds .................................. 38
Contributions Tax ...................................... 69
Controlled Amortization Class .......................... 27
Cooperatives ........................................... 14
CPR .................................................... 21
Credit Support ......................................... 9
Cut-Off Date ........................................... 27
Debt Service Coverage Ratio ............................ 15
Definitive Certificates ................................ 25
Depositor .............................................. 1
Determination Date ..................................... 20
Direct Participants .................................... 31
Distribution Date ...................................... 8
Distribution Date Statement ............................ 29
DOL .................................................... 81
DTC .................................................... 25
Due Dates .............................................. 17
Due Period ............................................. 20
Equity Participation ................................... 17
ERISA .................................................. 10
Excess Funds ........................................... 23
Excluded Plan .......................................... 83
Exemption .............................................. 82
FAMC ................................................... 18
FHLMC .................................................. 18
FNMA ................................................... 18
Garn Act ............................................... 56
GMACCM ................................................. 5
Grantor Trust Fractional Interest Certificate .......... 72
Grantor Trust Strip Certificate ........................ 73
Indirect Participants .................................. 31
</TABLE>
89
<PAGE>
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Insurance Proceeds ...................... 38
IRS ..................................... 40
Issue Premium ........................... 65
Letter of Credit Bank ................... 48
Liquidation Proceeds .................... 38
Loan-to-Value Ratio ..................... 16
Lock-Out Date ........................... 17
Lock-Out Period ......................... 17
Manager ................................. 5
Mark-to-Market Regulations .............. 68
Master Servicer ......................... 5
MBS ..................................... 1
MBS Administrator ....................... 5
MBS Agreement ........................... 18
MBS Issuer .............................. 18
MBS Servicer ............................ 18
MBS Trustee ............................. 18
Mortgage Asset Pool ..................... 1
Mortgage Asset Seller ................... 14
Mortgage Assets ......................... 1
Mortgage Notes .......................... 14
Mortgage Rate ........................... 6
Mortgaged Properties .................... 14
Mortgages ............................... 14
Multifamily Properties .................. 14
Net Leases .............................. 16
Non-Exempt Certificates ................. 83
Nonrecoverable Advance .................. 28
Notional Amount ......................... 7
Offered Certificates .................... 1
OID Regulations ......................... 58
Originator .............................. 14
OTS ..................................... 86
Participants ............................ 31
Parties in Interest ..................... 81
Pass-Through Rate ....................... 7
Percentage Interest ..................... 26
Permitted Investments ................... 37
Plans ................................... 81
Policy Statement ........................ 86
Pooling And Servicing Agreement ......... 6
Prepayment Assumption ................... 59
Prepayment Interest Shortfall ........... 20
Prepayment Premium ...................... 17
Prohibited Transactions Tax ............. 69
Prospectus Supplement ................... 1
PTCE .................................... 84
Purchase Price .......................... 34
Rating Agency ........................... 10
RCRA .................................... 55
Record Date ............................. 26
Related Proceeds ........................ 28
Relief Act .............................. 57
REMIC ................................... 2
</TABLE>
90
<PAGE>
<TABLE>
<CAPTION>
PAGE
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<S> <C>
REMIC Certificates ............................... 58
REMIC Provisions ................................. 58
REMIC Regular Certificates ....................... 10
REMIC Regulations ................................ 58
REMIC Residual Certificates ...................... 10
REO Property ..................................... 36
Restricted Group ................................. 82
Senior Certificates .............................. 7
Senior Liens ..................................... 14
Servicer ......................................... 5
SMMEA ............................................ 10
SPA .............................................. 21
Special Servicer ................................. 5
Stripped Interest Certificates ................... 7
Stripped Principal Certificates .................. 7
Subordinate Certificates ......................... 7
Sub-Servicer ..................................... 36
Sub-Servicing Agreement .......................... 37
Tax Exempt Investor .............................. 85
Tiered REMICs .................................... 59
Title V .......................................... 56
Trust Assets ..................................... 3
Trust Fund ....................................... 1
Trustee .......................................... 5
UBTI ............................................. 85
UCC .............................................. 50
Underwriter ...................................... 82
Underwritten Cash Flow ........................... 15
Underwritten Debt Service Coverage Ratio ......... 15
Underwritten DSCR ................................ 15
United States Person ............................. 72
Value ............................................ 16
Warranting Party ................................. 34
</TABLE>
91
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<PAGE>
"GMAC99C3.xls" is a Microsoft Excel*, Version 5.0 spreadsheet that
provides in electronic format certain information shown in Annex A in the
Prospectus Supplement. In addition, the spreadsheet provides certain
information detailing the changes in the amount of monthly payments with regard
to certain mortgage loans.
Open the file as you would normally open a spreadsheet in Microsoft Excel.
After the file is opened, a screen will appear requesting a password. Please
"click" the "read only" option. At that point, a securities law legend will be
displayed. READ THE LEGEND CAREFULLY. To view the data, see the worksheets
labeled "Characteristics" and "MF Schedule," respectively.
*Microsoft Excel is a registered trademark of Microsoft Corporation. No
dealer, salesman or other person has been authorized to give any information or
to make any representations not contained in this prospectus supplement and the
prospectus and, if given or made, such information or representations must not
be relied upon as having been authorized by the depositor or by the
underwriters. This prospectus supplement and the prospectus do not constitute
an offer to sell, or a solicitation of an offer to buy, the securities offered
hereby to anyone in any jurisdiction in which the person making such offer or
solicitation is not qualified to do so or to anyone to whom it is unlawful to
make any such offer or solicitation. Neither the delivery of this prospectus
supplement and the prospectus nor any sale made hereunder shall, under any
circumstances, create an implication that information in this prospectus
supplement or therein is correct as of any time since the date of this
prospectus.
<PAGE>
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No dealer, salesman or other person has been authorized to give any
information or to make any representations not contained in this prospectus
supplement and the prospectus and, if given or made, such information or
representations must not be relied upon as having been authorized by the
depositor or by the underwriters. This prospectus supplement and the prospectus
do not constitute an offer to sell, or a solicitation of an offer to buy, the
securities offered hereby to anyone in any jurisdiction in which the person
making such offer or solicitation is not qualified to do so or to anyone to
whom it is unlawful to make any such offer or solicitation. Neither the
delivery of this prospectus supplement and the prospectus nor any sale made
hereunder shall, under any circumstances, create an implication that
information in this prospectus supplement or therein is correct as of any time
since the date of this prospectus.
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Summary ............................................... S-6
Risk Factors .......................................... S-12
Description of the Mortgage Pool ...................... S-28
Servicing of the Mortgage Loans ....................... S-51
Description of the Certificates ....................... S-60
Yield and Maturity Considerations ..................... S-82
Federal Income Tax Consequences ....................... S-97
Method of Distribution ................................ S-100
Legal Matters ......................................... S-101
Ratings ............................................... S-101
Legal Investment ...................................... S-102
ERISA Considerations .................................. S-102
Index of Significant Definitions ...................... S-104
Annex A -- Characteristics of the Mortgage Loans ...... A-1
Annex B -- Form of Statement to Certificateholders
and Servicer Reports ............................... B-1
Annex C -- Structural and Collateral Term Sheet ....... C-1
Annex D -- Global Clearance, Settlement and Tax
Documentation Procedures ........................... D-1
PROSPECTUS
Prospectus Supplement ................................. 3
Available Information ................................. 3
Incorporation of Information by Reference ............. 4
Summary of Prospectus ................................. 5
Risk Factors .......................................... 11
Description of the Trust Funds ........................ 14
Yield and Maturity Considerations ..................... 19
The Depositor ......................................... 24
GMAC Commercial Mortgage Corporation .................. 24
Description of the Certificates ....................... 25
The Pooling and Servicing Agreements .................. 32
Description of Credit Support ......................... 47
Certain Legal Aspects of Mortgage Loans ............... 49
Certain Federal Income Tax Consequences ............... 58
State and Other Tax Consequences ...................... 80
ERISA Considerations .................................. 81
Legal Investment ...................................... 85
Use of Proceeds ....................................... 86
Method of Distribution ................................ 87
Legal Matters ......................................... 88
Financial Information ................................. 88
Rating ................................................ 88
Index of Principal Terms .............................. 89
</TABLE>
$1,031,057,000
(Approximate)
GMAC COMMERCIAL
MORTGAGE SECURITIES, INC.
MORTGAGE PASS-THROUGH
CERTIFICATES, SERIES 1999-C3
-----------------------------------------------------
PROSPECTUS SUPPLEMENT
-----------------------------------------------------
DEUTSCHE BANC ALEX. BROWN
GOLDMAN, SACHS & CO.
NEWMAN AND ASSOCIATES, INC.
as a member of the selling party
August 26, 1999
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