Common use of REPRESENTATIONS AND WARRANTIES WITH RESPECT TO LOANS Clause in Contracts

REPRESENTATIONS AND WARRANTIES WITH RESPECT TO LOANS. (a) The Issuer hereby represents and warrants to the Trustee for the benefit of the Noteholders as of the date hereof with respect to each Loan as follows: (i) Immediately prior to the collateral assignment of the Loan to the Trustee, the Issuer had good title to, and was the sole owner of, the Loan free and clear of all Liens. Except for the Issuer, no Person other than the Trustee has any interest in the Mortgage, whether as mortgagee, assignee, pledgee or otherwise. Immediately upon the collateral assignment of the Loan and taking possession thereof, the Trustee will have a first priority perfected security interest in each Loan, free and clear of all Liens. (ii) The Loan was originated in the United States, in a state where the originator of such Loan is qualified to transact such business, in the ordinary course of its business, except to the extent that any failure to be so qualified would not adversely affect the Loan or the Mortgage or the transfer thereof or the enforceability of the Obligor's obligations thereunder. The Issuer acquired title to the Loans in good faith, without notice of any adverse claim. (iii) The Loan has not been originated in, nor is such Loan subject to the laws of, any jurisdiction under which the transfer and assignment of such Loan to the Issuer would be unlawful, void or voidable. (iv) The information set forth in the Loan Schedule is true and correct in all material respects. (v) The terms of the Underlying Note and the Mortgage have not been impaired, waived, altered or modified in any respect, except by written instruments, executed in accordance with the customary credit policies of PMC or PMCT, as the case may be, which are reflected on the Loan Schedule. No Obligor has been released, in whole or in part, except pursuant to the terms of an assumption agreement which is part of the related Loan File and the terms of which are reflected in the Loan Schedule. (vi) The Underlying Note and the related Mortgage are not subject to any right of rescission, setoff, abatement, diminution, counterclaim or defense, including the defense of usury, nor will the operation of any of the terms of the Underlying Note or the TRUST INDENTURE - Page 14 Mortgage, or the exercise of any right thereunder in accordance with the terms thereof, render the Underlying Note or the Mortgage unenforceable, in whole or in part, or subject to any right of rescission, setoff, abatement, diminution, counterclaim or defense, including the defense of usury, and no such right of rescission, setoff, abatement, diminution, counterclaim or defense has been asserted with respect thereto. (vii) The Mortgage has not been satisfied, canceled or subordinated, in whole or in part, or rescinded, and except as reflected on the Loan Schedule, the Mortgaged Property has not been released from the Lien of the Mortgage or the security interest of any applicable security agreement or chattel mortgage, in whole or in part, nor has any instrument been executed that would effect any such release, cancellation, subordination or rescission. (viii) The Underlying Note and the Mortgage delivered to the Trustee are genuine originals (except where certified copies of the Mortgage have been delivered in accordance with this Indenture) and each is the legal, valid and binding obligation of the maker thereof, enforceable in accordance with its terms. (ix) There has been no fraud, dishonesty, misrepresentation or negligence on the part of the Issuer, the Independent Managers or the General Partner or, to the Issuer's knowledge, on the part of the originator, PMC, PMCT or the Obligor in connection with the origination of any Loan or in connection with the transfer and assignment of such Loan to the Issuer. (x) As of the Closing Date, there was no material default, breach, violation or event of acceleration existing under the Mortgage or the Underlying Note and no event which, with the passage of time or with notice and the expiration of any grace or cure period, would constitute such a default, breach, violation or event of acceleration, and since the Cut-off Date the Issuer had not waived any such default, breach, violation or event of acceleration. (xi) The Mortgage and the Underlying Note comply with all requirements of applicable federal, state and local laws and regulations. The origination and servicing of the Loan and the assignment of the Loan comply with any and all applicable requirements of any applicable federal, state or local law, including, without limitation, usury, truth-in-lending, real estate settlement procedures, consumer credit protection, equal credit opportunity and disclosure laws. To the Issuer's knowledge, each Mortgaged Property is in compliance in all material respects with all applicable laws, zoning ordinances, rules, covenants and restrictions affecting the construction, occupancy, use and operation of such Mortgaged Property. To the Issuer's knowledge, all inspections, licenses and certificates required, including certificates of occupancy, whether by law, ordinance, regulation or insurance standards to be made or issued with regard to the Mortgaged Property, have been obtained and are in full force and effect. (xii) To the Issuer's knowledge, each Loan was originated or purchased in accordance with PMCT's or PMC's standard mortgage, underwriting, origination and lending procedures. To the Issuer's knowledge, no adverse selection criteria were utilized by PMC, PMCT or the Issuer in selecting the Loans for inclusion in this transaction. (xiii) No Loan is a 30-Day Delinquent Loan. (xiv) The Issuer has not advanced funds or induced, solicited or knowingly received any advance of funds from a party other than the owner of the Mortgaged Property subject to the Mortgage, directly or indirectly, for the payment of any amount required by the Loan. (xv) To the Issuer's knowledge, there are no delinquent taxes, ground rents, water charges, sewer rents, assessments (including assessments payable in future installments) or other outstanding charges affecting the related Mortgaged Property. (xvi) The Mortgaged Property is located in the state indicated on the Loan Schedule, and, except as reflected on the Loan Schedule, consists of a single parcel of real property. The Mortgaged Property is in good repair, is free of damage and waste that would materially and adversely affect its value and such Mortgaged Property has not been materially damaged by fire, wind or other cause, which damage has not been fully repaired or for which insurance proceeds have not been received or are not expected to be received in an amount sufficient to pay for such repairs. (xvii) The Mortgage is a valid, subsisting and enforceable first Lien on the Mortgaged Property, including all buildings on the Mortgaged Property and all fixtures related thereto, and all additions, alterations and replacements made at any time with respect to the foregoing, except as reflected on the Loan Schedule. Such Lien is subject only to (1) the Lien of current real property taxes and assessments not yet due and payable, (2) covenants, conditions and restrictions, rights-of-way, easements and other matters of the public record as of the date of recording, none of which individually or in the aggregate materially interfere with the benefits of the security intended to be provided by the Mortgage or the operation and use of the related Mortgaged Property, and (3) other matters to which like properties are commonly subject which do not materially interfere with the benefits of the security intended to be provided by the Mortgage or the use, enjoyment, value or marketability of the related Mortgaged Property. Any security agreement, chattel mortgage or equivalent document related to and delivered in connection with the Loan establishes and creates a valid, subsisting and enforceable first Lien and first priority security interest on the property described therein, except as reflected on the Loan Schedule. Except as reflected on the Loan Schedule, the Underlying Note is not secured by any collateral except the Lien of the corresponding Mortgage and the security interest of any applicable security agreement or chattel mortgage referred to in this paragraph. (xviii) The Mortgage contains provisions for the acceleration of the payment of the unpaid principal balance of the Loan in the event the related Mortgaged Property is sold without the prior written consent of the Mortgagee thereunder. (xix) The Issuer has no knowledge of any mechanics' or similar liens or claims which have been filed for work, labor or material (or any rights outstanding that under applicable law could give rise to such Lien) affecting the Mortgaged Property which are or may be liens prior to, or equal or on parity with, the Lien of the Mortgage. (xx) The proceeds of the Loan have been fully disbursed and there is no requirement for future advances thereunder, and any and all requirements as to completion of any on-site or off-site improvements and as to disbursements of any escrow funds therefor have been complied with. (xxi) There is no proceeding pending for the total or partial condemnation of the Mortgaged Property. (xxii) The Mortgage contains customary provisions such as to render the rights and remedies of the holder thereof adequate for the realization against the Mortgaged Property of the benefits of the security provided thereby, including, (1) in the case of a Mortgage designated as a deed of trust, by trustee's sale and (2) otherwise by judicial foreclosure or power of sale. To the Issuer's knowledge, there is no homestead or other exemption available to the Obligor which would interfere with the right to sell the Mortgaged Property at a trustee's sale or the right to foreclose the Mortgage. (xxiii) In the event the Mortgage constitutes a deed of trust, a trustee, duly qualified under applicable law to serve as such, has been properly designated and currently so serves and is named in the Mortgage, and no fees or expenses are or will become payable by the Issuer or its assignees to the trustee under the deed of trust, except in connection with a trustee's sale after default by the Obligor. (xxiv) The Loan is an Eligible Loan as of the Closing Date. (xxv) The form of endorsement of each Underlying Note satisfies the requirement, if any, of endorsement in order to transfer all right, title and interest of the party so endorsing, as noteholder or assignee thereof, in and to that Underlying Note, and each form of assignment is in recordable form and is sufficient to effect the assignment of and to transfer to the assignee thereof, all right, title and interest under each Mortgage to which that assignment relates. (xxvi) Each document required under Section 2.6(b) hereof to be delivered to the Trustee on behalf of the Issuer for each Loan meets the requirements of Section 2.6(b) and has been or will be, on or before the Closing Date, delivered to the Trustee. (xxvii) A Phase I environmental report was prepared with respect to each Mortgaged Property or part thereof constituting primary collateral securing the Loan, other than the Mortgaged Properties indicated in the Loan Schedule, prior to the date of this Agreement. To the Issuer's knowledge, each Mortgaged Property was, as of its date of origination of the Underlying Note and as of the Closing Date in material compliance with all applicable environmental laws and regulations. (xxviii) All escrow deposits, if any, and other payments relating to each Loan have been delivered to the Servicer or its agent, and all amounts required to be deposited by the Issuer or the related Obligor have been deposited and there are no deficiencies with regard thereto. (xxix) The Lien of each Mortgage is insured by an ALTA lender's title insurance policy (or a binding commitment) or its equivalent, as adopted in the applicable jurisdiction. Except as reflected on the Loan Schedule, the policy (or such binding commitment) insures the originator of such Loan, its successors and assigns, as to the first priority Lien of the Mortgage in the original principal amount after all advances of principal, subject only to permitted encumbrances, none of which, individually or in the aggregate should interfere with the current use of the Mortgaged Property or materially detract from the benefit of the first priority Lien of the Mortgage. The originator of such Loan (including its successors and assigns) is the sole named insured of the policy (or such binding commitment), and the policy (or such binding commitment) is assignable to the Issuer without the consent of or any notification to the insurer. No claims have been made under such policy (or such binding commitment), and the Issuer has no knowledge of any matter that would impair or diminish the coverage of such policy. (xxx) Each Mortgaged Property is covered by insurance policies providing (1) coverage against loss or damage sustained by fire and extended perils included within the classification "All Risk of Physical Loss" in an amount sufficient to prevent the Obligor from being deemed a co-insurer, and to provide coverage of replacement or actual cost, consistent with industry standards; and the policies contain a standard mortgagee clause naming the mortgagee and its successors as mortgagees and loss payees; (2) flood insurance (if any portion of the Mortgaged Property is located in an area identified by the Federal Emergency Management Agency as having special hazards); and (3) comprehensive general liability insurance in amounts as are generally required by commercial mortgage lenders. The insurance policies contain clauses providing they are not terminable and may not be reduced without 10 days prior written notice to the mortgagee, and all premiums due and payable through the Closing Date have been made. To the Issuer's knowledge, no notice of termination or cancellation with respect to any such policies has been received by PMC or PMCT, as applicable, which remains effective. The Mortgage obligates the Obligor to maintain all such insurance at its cost and expense, and on the Obligor's failure to do so, authorizes the holder of the Mortgage to maintain such insurance and obtain reimbursement therefore from the Obligor (xxxi) To the Issuer's knowledge, the Obligor has good title to the Mortgaged Property. (xxxii) The Issuer acknowledges that the Trustee, as assignee of the Issuer with respect to the Contribution Agreement, may enforce any right or remedy thereunder, including any right or remedy with respect to breaches of the representations and warranties thereunder.

REPRESENTATIONS AND WARRANTIES WITH RESPECT TO LOANS. (a) The Issuer hereby represents and warrants to the Trustee for the benefit of the Noteholders as of the date hereof with respect to each Loan as follows: (i) Immediately prior to the collateral assignment of the Loan to the Trustee, the Issuer had good title to, and was the sole owner of, the Loan free and clear of all Liens. Except for the Issuer, no Person other than PMC or PMCT, as the case may be, and the Trustee has any interest in the Mortgage, whether as mortgagee, assignee, pledgee or otherwise. Immediately upon the collateral assignment of the Loan and taking possession thereof, the Trustee will have a first priority perfected security interest in each Loan, free and clear of all Liens. (ii) The Loan was originated in the United States, in a state where the originator of such Loan Loan, is qualified to transact such business, in the ordinary course of its business, except to the extent that any failure to be so qualified would not adversely affect the Loan or the Mortgage or the transfer thereof or the enforceability of the Obligor's obligations thereunder. The Issuer PMC or PMCT, as the case may be, acquired title to the Loans in good faith, without notice of any adverse claim. . (iii) The Loan has not been originated in, nor is such Loan subject to the laws of, any jurisdiction under which the transfer and assignment of such Loan to the Issuer would be unlawful, void or voidable. (iv) The information set forth in the Loan Schedule is true and correct in all material respects. (v) The terms of the Underlying Note and the Mortgage have not been impaired, waived, altered or modified in any respect, except by written instruments, executed in accordance with the customary credit policies of PMC or PMCT, as the case may be, which are reflected on the Loan Schedule. No Obligor has been released, in whole or in part, except pursuant to the terms of an assumption agreement which is part of the related Loan File and the terms of which are reflected in the Loan Schedule. (vi) The Underlying Note and the related Mortgage are not subject to any right of rescission, setoff, abatement, diminution, counterclaim or defense, including the defense of usury, nor will the operation of any of the terms of the Underlying Note or the TRUST INDENTURE - Page 14 Mortgage, or the exercise of any right thereunder in accordance with the terms thereof, render the Underlying Note or the Mortgage unenforceable, in whole or in part, or subject to any right of rescission, setoff, abatement, diminution, counterclaim or defense, including the defense of usury, and no such right of rescission, setoff, abatement, diminution, counterclaim or defense has been asserted with respect thereto. (vii) The Mortgage has not been satisfied, canceled or subordinated, in whole or in part, or rescinded, and except as reflected on the Loan Schedule, the Mortgaged Property has not been released from the Lien of the Mortgage or the security interest of any applicable security agreement or chattel mortgage, in whole or in part, nor has any instrument been executed that would effect any such release, cancellation, subordination or rescission. (viii) The Underlying Note and the Mortgage delivered to the Trustee are genuine originals (except where certified copies of the Mortgage have been delivered in accordance with this Indenture) and each is the legal, valid and binding obligation of the maker thereof, enforceable in accordance with its terms. (ix) There has been no fraud, dishonesty, misrepresentation or negligence on the part of the Issuer, the Independent Managers or the General Partner or, to the Issuer's knowledge, on the part of the originator, PMC, PMCT or the Obligor in connection with the origination of any Loan or in connection with the transfer and assignment of such Loan to the Issuer. (x) As of the Closing Date, there was no material default, breach, violation or event of acceleration existing under the Mortgage or the Underlying Note and no event which, with the passage of time or with notice and the expiration of any grace or cure period, would constitute such a default, breach, violation or event of acceleration, and since the Cut-off Date the Issuer had not waived any such default, breach, violation or event of acceleration. (xi) The Mortgage and the Underlying Note comply with all requirements of applicable federal, state and local laws and regulations. The origination and servicing of the Loan and the assignment of the Loan comply with any and all applicable requirements of any applicable federal, state or local law, including, without limitation, usury, truth-in-lending, real estate settlement procedures, consumer credit protection, equal credit opportunity and disclosure laws. To the Issuer's knowledge, each Mortgaged Property is in compliance in all material respects with all applicable laws, zoning ordinances, rules, covenants and restrictions affecting the construction, occupancy, use and operation of such Mortgaged Property. To the Issuer's knowledge, all inspections, licenses and certificates required, including certificates of occupancy, whether by law, ordinance, regulation or insurance standards to be made or issued with regard to the Mortgaged Property, have been obtained and are in full force and effect. (xii) To the Issuer's knowledge, each Loan was originated or purchased in accordance with PMCT's or PMC's standard mortgage, underwriting, origination and lending procedures. To the Issuer's knowledge, no adverse selection criteria were utilized by PMC, PMCT or the Issuer in selecting the Loans for inclusion in this transaction. (xiii) No Loan is a 30-Day Delinquent Loan. (xiv) The Issuer has not advanced funds or induced, solicited or knowingly received any advance of funds from a party other than the owner of the Mortgaged Property subject to the Mortgage, directly or indirectly, for the payment of any amount required by the Loan. (xv) To the Issuer's knowledge, there are no delinquent taxes, ground rents, water charges, sewer rents, assessments (including assessments payable in future installments) or other outstanding charges affecting the related Mortgaged Property. (xvi) The Mortgaged Property is located in the state indicated on the Loan Schedule, and, except as reflected on the Loan Schedule, consists of a single parcel of real property. The Mortgaged Property is in good repair, is free of damage and waste that would materially and adversely affect its value and such Mortgaged Property has not been materially damaged by fire, wind or other cause, which damage has not been fully repaired or for which insurance proceeds have not been received or are not expected to be received in an amount sufficient to pay for such repairs. (xvii) The Mortgage is a valid, subsisting and enforceable first Lien on the Mortgaged Property, including all buildings on the Mortgaged Property and all fixtures related thereto, and all additions, alterations and replacements made at any time with respect to the foregoing, except as reflected on the Loan Schedule. Such Lien is subject only to (1) the Lien of current real property taxes and assessments not yet due and payable, (2) covenants, conditions and restrictions, rights-of-way, easements and other matters of the public record as of the date of recording, none of which individually or in the aggregate materially interfere with the benefits of the security intended to be provided by the Mortgage or the operation and use of the related Mortgaged Property, and (3) other matters to which like properties are commonly subject which do not materially interfere with the benefits of the security intended to be provided by the Mortgage or the use, enjoyment, value or marketability of the related Mortgaged Property. Any security agreement, chattel mortgage or equivalent document related to and delivered in connection with the Loan establishes and creates a valid, subsisting and enforceable first Lien and first priority security interest on the property described therein, except as reflected on the Loan Schedule. Except as reflected on the Loan Schedule, the Underlying Note is not secured by any collateral except the Lien of the corresponding Mortgage and the security interest of any applicable security agreement or chattel mortgage referred to in this paragraph. (xviii) The Mortgage contains provisions for the acceleration of the payment of the unpaid principal balance of the Loan in the event the related Mortgaged Property is sold without the prior written consent of the Mortgagee thereunder. (xix) The Issuer has no knowledge of any mechanics' or similar liens or claims which have been filed for work, labor or material (or any rights outstanding that under applicable law could give rise to such Lien) affecting the Mortgaged Property which are or may be liens prior to, or equal or on parity with, the Lien of the Mortgage. (xx) The proceeds of the Loan have been fully disbursed and there is no requirement for future advances thereunder, and any and all requirements as to completion of any on-site or off-site improvements and as to disbursements of any escrow funds therefor have been complied with. (xxi) There is no proceeding pending for the total or partial condemnation of the Mortgaged Property. (xxii) The Mortgage contains customary provisions such as to render the rights and remedies of the holder thereof adequate for the realization against the Mortgaged Property of the benefits of the security provided thereby, including, (1) in the case of a Mortgage designated as a deed of trust, by trustee's sale and (2) otherwise by judicial foreclosure or power of sale. To the Issuer's knowledge, there is no homestead or other exemption available to the Obligor which would interfere with the right to sell the Mortgaged Property at a trustee's sale or the right to foreclose the Mortgage. (xxiii) In the event the Mortgage constitutes a deed of trust, a trustee, duly qualified under applicable law to serve as such, has been properly designated and currently so serves and is named in the Mortgage, and no fees or expenses are or will become payable by the Issuer or its assignees to the trustee under the deed of trust, except in connection with a trustee's sale after default by the Obligor. (xxiv) The Loan is an Eligible Loan as of the Closing Date. (xxv) The form of endorsement of each Underlying Note satisfies the requirement, if any, of endorsement in order to transfer all right, title and interest of the party so endorsing, as noteholder or assignee thereof, in and to that Underlying Note, and each form of assignment is in recordable form and is sufficient to effect the assignment of and to transfer to the assignee thereof, all right, title and interest under each Mortgage to which that assignment relates. (xxvi) Each document required under Section 2.6(b) hereof to be delivered to the Trustee on behalf of the Issuer for each Loan meets the requirements of Section 2.6(b) and has been or will be, on or before the Closing Date, delivered to the Trustee. (xxvii) A Phase I environmental report was prepared with respect to each Mortgaged Property or part thereof constituting primary collateral securing the Loan, other than the Mortgaged Properties indicated in the Loan Schedule, prior to the date of this Agreement. To the Issuer's knowledge, each Mortgaged Property was, as of its date of origination of the Underlying Note and as of the Closing Date in material compliance with all applicable environmental laws and regulations. (xxviii) All escrow deposits, if any, and other payments relating to each Loan have been delivered to the Servicer or its agent, and all amounts required to be deposited by the Issuer or the related Obligor have been deposited and there are no deficiencies with regard thereto. (xxix) The Lien of each Mortgage is insured by an ALTA lender's title insurance policy (or a binding commitment) or its equivalent, as adopted in the applicable jurisdiction. Except as reflected on the Loan Schedule, the policy (or such binding commitment) insures the originator of such Loan, its successors and assigns, as to the first priority Lien of the Mortgage in the original principal amount after all advances of principal, subject only to permitted encumbrances, none of which, individually or in the aggregate should interfere with the current use of the Mortgaged Property or materially detract from the benefit of the first priority Lien of the Mortgage. The originator of such Loan (including its successors and assigns) is the sole named insured of the policy (or such binding commitment), and the policy (or such binding commitment) is assignable to the Issuer without the consent of or any notification to the insurer. No claims have been made under such policy (or such binding commitment), and the Issuer has no knowledge of any matter that would impair or diminish the coverage of such policy. (xxx) Each Mortgaged Property is covered by insurance policies providing (1) coverage against loss or damage sustained by fire and extended perils included within the classification "All Risk of Physical Loss" in an amount sufficient to prevent the Obligor from being deemed a co-insurer, and to provide coverage of replacement or actual cost, consistent with industry standards; and the policies contain a standard mortgagee clause naming the mortgagee and its successors as mortgagees and loss payees; (2) flood insurance (if any portion of the Mortgaged Property is located in an area identified by the Federal Emergency Management Agency as having special hazards); and (3) comprehensive general liability insurance in amounts as are generally required by commercial mortgage lenders. The insurance policies contain clauses providing they are not terminable and may not be reduced without 10 days prior written notice to the mortgagee, and all premiums due and payable through the Closing Date have been made. To the Issuer's knowledge, no notice of termination or cancellation with respect to any such policies has been received by PMC or PMCT, as applicable, which remains effective. The Mortgage obligates the Obligor to maintain all such insurance at its cost and expense, and on the Obligor's failure to do so, authorizes the holder of the Mortgage to maintain such insurance and obtain reimbursement therefore from the Obligor (xxxi) To the Issuer's knowledge, the Obligor has good title to the Mortgaged Property. (xxxii) The Issuer acknowledges that the Trustee, as assignee of the Issuer with respect to the Contribution Agreement, may enforce any right or remedy thereunder, including any right or remedy with respect to breaches of the representations and warranties thereunder.

REPRESENTATIONS AND WARRANTIES WITH RESPECT TO LOANS. (a) The Issuer hereby represents and warrants to the Trustee for the benefit of the Noteholders as of the date hereof with respect to each Loan as follows: (i) Immediately prior to the collateral assignment of the Loan to the Trustee, the Issuer had good title to, and was the sole owner of, the Loan free and clear of all Liens. Except for the Issuer, no Person other than PMC or PMCT, as the case may be, and the Trustee has any interest in the Mortgage, whether as mortgagee, assignee, pledgee or otherwise. Immediately upon the collateral assignment of the Loan and taking possession thereof, the Trustee will have a first priority perfected security interest in each Loan, free and clear of all Liens. (ii) The Loan was originated in the United States, in a state where the originator of such Loan is qualified to transact such business, in the ordinary course of its business, except to the extent that any failure to be so qualified would not adversely affect the Loan or the Mortgage or the transfer thereof or the enforceability of the Obligor's obligations thereunder. The Issuer PMC or PMCT, as the case may be, acquired title to the Loans in good faith, without notice of any adverse claim. (iii) The Loan has not been originated in, nor is such Loan subject to the laws of, any jurisdiction under which the transfer and assignment of such Loan to the Issuer would be unlawful, void or voidable. (iv) The information set forth in the Loan Schedule is true and correct in all material respects. (v) The terms of the Underlying Note and the Mortgage have not been impaired, waived, altered or modified in any respect, except by written instruments, executed in accordance with the customary credit policies of PMC or PMCT, as the case may be, which are reflected on the Loan Schedule. No Obligor has been released, in whole or in part, except pursuant to the terms of an assumption agreement which is part of the related Loan File and the terms of which are reflected in the Loan Schedule. (vi) The Underlying Note and the related Mortgage are not subject to any right of rescission, setoff, abatement, diminution, counterclaim or defense, including the defense of usury, nor will the operation of any of the terms of the Underlying Note or the TRUST INDENTURE - Page 14 Mortgage, or the exercise of any right thereunder in accordance with the terms thereof, render the Underlying Note or the Mortgage unenforceable, in whole or in part, or subject to any right of rescission, setoff, abatement, diminution, counterclaim or defense, including the defense of usury, and no such right of rescission, setoff, abatement, diminution, counterclaim or defense has been asserted with respect thereto. (vii) The Mortgage has not been satisfied, canceled or subordinated, in whole or in part, or rescinded, and except as reflected on the Loan Schedule, the Mortgaged Property has not been released from the Lien of the Mortgage or the security interest of any applicable security agreement or chattel mortgageMortgage, in whole or in part, nor has any instrument been executed that would effect any such release, cancellation, subordination or rescission. (viii) The Underlying Note and the Mortgage delivered to the Trustee are genuine originals (except where certified copies of the Mortgage have been delivered in accordance with this Indenture) and each is the legal, valid and binding obligation of the maker thereof, enforceable in accordance with its terms. (ix) There has been no fraud, dishonesty, misrepresentation or negligence on the part of the Issuer, the Independent Managers or the General Partner or, to the Issuer's knowledge, on the part of the originator, PMC, PMCT or the Obligor in connection with the origination of any Loan or in connection with the transfer and assignment of such Loan to the Issuer. (x) As of the Closing Date, there was no material default, breach, violation or event of acceleration existing under the Mortgage or the Underlying Note and no event which, with the passage of time or with notice and the expiration of any grace or cure period, would constitute such a default, breach, violation or event of acceleration, and since the Cut-off Date the Issuer had not waived any such default, breach, violation or event of acceleration. (xi) The Mortgage and the Underlying Note comply with all requirements of applicable federal, state and local laws and regulations. The origination and servicing of the Loan and the assignment of the Loan comply with any and all applicable requirements of any applicable federal, state or local law, including, without limitation, usury, truth-in-lending, real estate settlement procedures, consumer credit protection, equal credit opportunity and disclosure laws. To the Issuer's knowledge, each Mortgaged Property is in compliance in all material respects with all applicable laws, zoning ordinances, rules, covenants and restrictions affecting the construction, occupancy, use and operation of such Mortgaged Property. To the Issuer's knowledge, all inspections, licenses and certificates required, including certificates of occupancy, whether by law, ordinance, regulation or insurance standards to be made or issued with regard to the Mortgaged Property, have been obtained and are in full force and effect. (xii) To the Issuer's knowledge, each Loan was originated or purchased in accordance with PMCT's or PMC's standard mortgage, underwriting, origination and lending procedures. To the Issuer's knowledge, no adverse selection criteria were utilized by PMC, PMCT or the Issuer in selecting the Loans for inclusion in this transaction. (xiii) No Loan is a 30-Day Delinquent Loan30 or more days contractually past due. (xiv) The Issuer has not advanced funds or induced, solicited or knowingly received any advance of funds from a party other than the owner of the Mortgaged Property subject to the Mortgage, directly or indirectly, for the payment of any amount required by the Loan. (xv) To the Issuer's knowledge, there are no delinquent taxes, ground rents, water charges, sewer rents, assessments (including assessments payable in future installments) or other outstanding charges affecting the related Mortgaged Property. (xvi) The Mortgaged Property is located in the state indicated on the Loan Schedule, and, except as reflected on the Loan Schedule, consists of a single parcel of real property. The Mortgaged Property is in good repair, is free of damage and waste that would materially and adversely affect its value and such Mortgaged Property has not been materially damaged by fire, wind or other cause, which damage has not been fully repaired or for which insurance proceeds have not been received or are not expected to be received in an amount sufficient to pay for such repairs. (xvii) The Mortgage is a valid, subsisting and enforceable first Lien on the Mortgaged Property, including all buildings on the Mortgaged Property and all fixtures related thereto, and all additions, alterations and replacements made at any time with respect to the foregoing, except as reflected on the Loan Schedule. Such Lien is subject only to (1) the Lien of current real property taxes and assessments not yet due and payable, (2) covenants, conditions and restrictions, rights-of-way, easements and other matters of the public record as of the date of recording, none of which individually or in the aggregate materially interfere with the benefits of the security intended to be provided by the Mortgage or the operation and use of the related Mortgaged Property, and (3) other matters to which like properties are commonly subject which do not materially interfere with the benefits of the security intended to be provided by the Mortgage or the use, enjoyment, value or marketability of the related Mortgaged Property. Any security agreement, chattel mortgage or equivalent document related to and delivered in connection with the Loan establishes and creates a valid, subsisting and enforceable first Lien and first priority security interest on the property described therein, except as reflected on the Loan Schedule. Except as reflected on the Loan Schedule, the Underlying Note is not secured by any collateral except the Lien of the corresponding Mortgage and the security interest of any applicable security agreement or chattel mortgage referred to in this paragraph. (xviii) The Mortgage contains provisions for the acceleration of the payment of the unpaid principal balance of the Loan in the event the related Mortgaged Property is sold without the prior written consent of the Mortgagee thereunder. (xix) The Issuer has no knowledge of any mechanics' or similar liens or claims which have been filed for work, labor or material (or any rights outstanding that under applicable law could give rise to such Lien) affecting the Mortgaged Property which are or may be liens prior to, or equal or on parity with, the Lien of the Mortgage. (xx) The proceeds of the Loan have been fully disbursed and there is no requirement for future advances thereunder, and any and all requirements as to completion of any on-site or off-site improvements and as to disbursements of any escrow funds therefor have been complied with. (xxi) There is no proceeding pending for the total or partial condemnation of the Mortgaged Property. (xxii) The Mortgage contains customary provisions such as to render the rights and remedies of the holder thereof adequate for the realization against the Mortgaged Property of the benefits of the security provided thereby, including, (1) in the case of a Mortgage designated as a deed of trust, by trustee's sale and (2) otherwise by judicial foreclosure or power of sale. To the Issuer's knowledge, there is no homestead or other exemption available to the Obligor which would interfere with the right to sell the Mortgaged Property at a trustee's sale or the right to foreclose the Mortgage. (xxiii) In the event the Mortgage constitutes a deed of trust, a trustee, duly qualified under applicable law to serve as such, has been properly designated and currently so serves and is named in the Mortgage, and no fees or expenses are or will become payable by the Issuer or its assignees to the trustee under the deed of trust, except in connection with a trustee's sale after default by the Obligor. (xxiv) The Loan is an Eligible Loan as of the Closing Date. (xxv) The form of endorsement of each Underlying Note satisfies the requirement, if any, of endorsement in order to transfer all right, title and interest of the party so endorsing, as noteholder or assignee thereof, in and to that Underlying Note, and each form of assignment is in recordable form and is sufficient to effect the assignment of and to transfer to the assignee thereof, all right, title and interest under each Mortgage to which that assignment relates. (xxvi) Each document required under Section 2.6(b) hereof to be delivered to the Trustee on behalf of the Issuer for each Loan meets the requirements of Section 2.6(b) and has been or will be, on or before the Closing Date, delivered to the Trustee. (xxvii) A Phase I environmental report was prepared with respect to each Mortgaged Property or part thereof constituting primary collateral securing the Loan, other than the Mortgaged Properties indicated in the Loan Schedule, prior to the date of this Agreement. To the Issuer's knowledge, each Mortgaged Property was, as of its date of origination of the Underlying Note and as of the Closing Date in material compliance with all applicable environmental laws and regulations. (xxviii) All escrow deposits, if any, and other payments relating to each Loan have been delivered to the Servicer or its agent, and all amounts required to be deposited by the Issuer or the related Obligor have been deposited and there are no deficiencies with regard thereto. (xxix) The Lien of each Mortgage is insured by an ALTA lender's title insurance policy (or a binding commitment) or its equivalent, as adopted in the applicable jurisdiction. Except as reflected on the Loan Schedule, the policy (or such binding commitment) insures the originator of such Loan, its successors and assigns, as to the first priority Lien of the Mortgage in the original principal amount after all advances of principal, subject only to permitted encumbrances, none of which, individually or in the aggregate should interfere with the current use of the Mortgaged Property or materially detract from the benefit of the first priority Lien of the Mortgage. The originator of such Loan (including its successors and assigns) is the sole named insured of the policy (or such binding commitment), and the policy (or such binding commitment) is assignable to the Issuer without the consent of or any notification to the insurer. No claims have been made under such policy (or such binding commitment), and the Issuer has no knowledge of any matter that would impair or diminish the coverage of such policy. (xxx) Each Mortgaged Property is covered by insurance policies providing (1) coverage against loss or damage sustained by fire and extended perils included within the classification "All Risk of Physical Loss" in an amount sufficient to prevent the Obligor from being deemed a co-insurer, and to provide coverage of replacement or actual cost, consistent with industry standards; and the policies contain a standard mortgagee clause naming the mortgagee and its successors as mortgagees and loss payees; (2) flood insurance (if any portion of the Mortgaged Property is located in an area identified by the Federal Emergency Management Agency as having special hazards); and (3) comprehensive general liability insurance in amounts as are generally required by commercial mortgage lenders. The insurance policies contain clauses providing they are not terminable and may not be reduced without 10 days prior written notice to the mortgagee, and all premiums due and payable through the Closing Date have been made. To the Issuer's knowledge, no notice of termination or cancellation with respect to any such policies has been received by PMC or PMCT, as applicable, which remains effective. The Mortgage obligates the Obligor to maintain all such insurance at its cost and expense, and on the Obligor's failure to do so, authorizes the holder of the Mortgage to maintain such insurance and obtain reimbursement therefore from the Obligor. (xxxi) To the Issuer's knowledge, the Obligor has good title to the Mortgaged Property. (xxxii) The Issuer acknowledges that the Trustee, as assignee of the Issuer with respect to the Contribution Agreement, may enforce any right or remedy thereunder, including any right or remedy with respect to breaches of the representations and warranties thereunder. (xxxiii) Attached as Attachment B to the Officer's Certificate delivered to the Issuer on the Closing Date pursuant to Section 4(c)(vi) of the Contribution Agreement (the "Closing Certificate") are true and complete copies of the following standard form loan documents of the Companies: (i) note, (ii) mortgage, security agreement and assignment of rents, (iii) guaranty, (iv) pledge agreement, (v) security agreement, (vi) environmental indemnity agreement, and (vii) construction loan agreement (each, a "Form Loan Document"). Except as set forth on the Loan Schedule, each document evidencing and/or securing each Loan which corresponds to a Form Loan Document is in substantially the form of the relevant Form Loan Document attached to the Closing Certificate, with such modifications thereto as were deemed reasonably necessary or appropriate by the Company or the Affiliate thereof that originated such Loan; provided that such modifications shall not substantially interfere with the practical realization of the principal legal benefits and security provided by such documents; and provided further, to the extent that the documents evidencing and/or securing any Loan do not conform to the Form Loan Documents, such documents will provide in all material respects the principal legal benefits and security provided by the Form Loan Documents.

REPRESENTATIONS AND WARRANTIES WITH RESPECT TO LOANS. (a) The Issuer hereby represents and warrants to the Trustee for the benefit of the Noteholders as of the date hereof with respect to each Loan as follows: (i) Immediately prior to the collateral assignment of the Loan to the Trustee, the Issuer had good title to, and was the sole owner of, the Loan free and clear of all Liens. Except for the Issuer, no Person other than PMC or PMCT, as the case may be, and the Trustee has any interest in the Mortgage, whether as mortgagee, assignee, pledgee or otherwise. Immediately upon the collateral assignment of the Loan and taking possession thereof, the Trustee will have a first priority perfected security interest in each Loan, free and clear of all Liens. (ii) The Loan was originated in the United States, in a state where PMC or PMCT, as the originator of such Loan case may be, is qualified to transact such business, in the ordinary course of its business, except to the extent that any failure to be so qualified would not adversely affect the Loan or the Mortgage or the transfer thereof or the enforceability of the Obligor's obligations thereunder. The Issuer PMC or PMCT, as the case may be, acquired title to the Loans in good faith, without notice of any adverse claim. (iii) The Loan has not been originated in, nor is such Loan subject to the laws of, any jurisdiction under which the transfer and assignment of such Loan to the Issuer would be unlawful, void or voidable. (iv) The information set forth in the Loan Schedule is true and correct in all material respects. (v) The terms of the Underlying Note and the Mortgage have not been impaired, waived, altered or modified in any respect, except by written instruments, executed in accordance with the customary credit policies of PMC or PMCT, as the case may be, which are reflected on the Loan Schedule. No Obligor has been released, in whole or in part, except pursuant to the terms of an assumption agreement which is part of the related Loan File and the terms of which are reflected in the Loan Schedule. (vi) The Underlying Note and the related Mortgage are not subject to any right of rescission, setoff, abatement, diminution, counterclaim or defense, including the defense of usury, nor will the operation of any of the terms of the Underlying Note or the TRUST INDENTURE - Page 14 Mortgage, or the exercise of any right thereunder in accordance with the terms thereof, render the Underlying Note or the Mortgage unenforceable, in whole or in part, or subject to any right of rescission, setoff, abatement, diminution, counterclaim or defense, including the defense of usury, and no such right of rescission, setoff, abatement, diminution, counterclaim or defense has been asserted with respect thereto. (vii) The Mortgage has not been satisfied, canceled or subordinated, in whole or in part, or rescinded, and except as reflected on the Loan Schedule, the Mortgaged Property has not been released from the Lien lien of the Mortgage or the security interest of any applicable security agreement or chattel mortgageMortgage, in whole or in part, nor has any instrument been executed that would effect any such release, cancellation, subordination or rescission. (viii) The Underlying Note and the Mortgage delivered to the Trustee are genuine originals (except where certified copies of the Mortgage have been delivered in accordance with this Indenture) and each is the legal, valid and binding obligation of the maker thereof, enforceable in accordance with its terms. (ix) There has been no fraud, dishonesty, misrepresentation or negligence on the part of the Issuer, the Independent Managers Directors or the General Partner or, to the Issuer's knowledge, on the part of the originator, PMC, PMCT or the Obligor in connection with the origination of any Loan or in connection with the transfer and assignment of such Loan to the Issuer. (x) As of the Closing Date, there was no material default, breach, violation or event of acceleration existing under the Mortgage or the Underlying Note and no event which, with the passage of time or with notice and the expiration of any grace or cure period, would constitute such a default, breach, violation or event of acceleration, and since the Cut-off Date the Issuer had not waived any such default, breach, violation or event of acceleration. (xi) The Mortgage and the Underlying Note comply with all requirements of applicable federal, state and local laws and regulations. The origination and servicing of the Loan and the assignment of the Loan comply with any and all applicable requirements of any applicable federal, state or local law, including, without limitation, usury, truth-in-lending, real estate settlement procedures, consumer credit protection, equal credit opportunity and disclosure laws. To the Issuer's knowledge, each Mortgaged Property is in compliance in all material respects with all applicable laws, zoning ordinances, rules, covenants and restrictions affecting the construction, occupancy, use and operation of such Mortgaged Property. To the Issuer's knowledge, all inspections, licenses and certificates required, including certificates of occupancy, whether by law, ordinance, regulation or insurance standards to be made or issued with regard to the Mortgaged Property, have been obtained and are in full force and effect. (xii) To the Issuer's knowledge, each Each Loan was originated or purchased in accordance with PMCT's or PMC's standard mortgage, underwriting, origination and lending procedures. To the Issuer's knowledge, no No adverse selection criteria were utilized by PMC, PMCT or the Issuer in selecting the Loans for inclusion in this transaction. (xiii) No Except as described on the Loan Schedule, no Loan is a 30-Day Delinquent Loan. (xiv) The Issuer has not advanced funds or induced, solicited or knowingly received any advance of funds from a party other than the owner of the Mortgaged Property subject to the Mortgage, directly or indirectly, for the payment of any amount required by the Loan. (xv) To the Issuer's knowledge, there are no delinquent taxes, ground rents, water charges, sewer rents, assessments (including assessments payable in future installments) or other outstanding charges affecting the related Mortgaged Property. (xvi) The Mortgaged Property is located in the state indicated on the Loan Schedule, and, except as reflected on the Loan Schedule, consists of a single parcel of real property. The Mortgaged Property is in good repair, is free of damage and waste that would materially and adversely affect its value and such Mortgaged Property has not been materially damaged by fire, wind or other cause, which damage has not been fully repaired or for which insurance proceeds have not been received or are not expected to be received in an amount sufficient to pay for such repairs. (xvii) The Mortgage is a valid, subsisting and enforceable first Lien lien on the Mortgaged Property, including all buildings on the Mortgaged Property and all fixtures related thereto, and all additions, alterations and replacements made at any time with respect to the foregoing, except as reflected on the Loan Schedule. Such Lien lien is subject only to (1) the Lien lien of current real property taxes and assessments not yet due and payable, (2) covenants, conditions and restrictions, rights-of-way, easements and other matters of the public record as of the date of recording, none of which individually or in the aggregate materially interfere with the benefits of the security intended to be provided by the Mortgage or the operation and use of the related Mortgaged Property, and (3) other matters to which like properties are commonly subject which do not materially interfere with the benefits of the security intended to be provided by the Mortgage or the use, enjoyment, value or marketability of the related Mortgaged Property. Any security agreement, chattel mortgage or equivalent document related to and delivered in connection with the Loan establishes and creates a valid, subsisting and enforceable first Lien lien and first priority security interest on the property described therein, except as reflected on the Loan Schedule. Except as reflected on the Loan Schedule, the Underlying Note is not secured by any collateral except the Lien lien of the corresponding Mortgage and the security interest of any applicable security agreement or chattel mortgage referred to in this paragraph. (xviii) The Mortgage contains provisions for the acceleration of the payment of the unpaid principal balance of the Loan in the event the related Mortgaged Property is sold without the prior written consent of the Mortgagee thereunder. (xix) The Issuer has no knowledge of any mechanics' or similar liens or claims which have been filed for work, labor or material (or any rights outstanding that under applicable law could give rise to such Lienlien) affecting the Mortgaged Property which are or may be liens prior to, or equal or on parity with, the Lien lien of the Mortgage. (xx) The proceeds of the Loan have been fully disbursed and there is no requirement for future advances thereunder, and any and all requirements as to completion of any on-site or off-site improvements and as to disbursements of any escrow funds therefor have been complied with. (xxi) There is no proceeding pending for the total or partial condemnation of the Mortgaged Property. (xxii) The Mortgage contains customary provisions such as to render the rights and remedies of the holder thereof adequate for the realization against the Mortgaged Property of the benefits of the security provided thereby, including, (1) in the case of a Mortgage designated as a deed of trust, by trustee's sale and (2) otherwise by judicial foreclosure or power of sale. To the Issuer's knowledge, there is no homestead or other exemption available to the Obligor which would interfere with the right to sell the Mortgaged Property at a trustee's sale or the right to foreclose the Mortgage. (xxiii) In the event the Mortgage constitutes a deed of trust, a trustee, duly qualified under applicable law to serve as such, has been properly designated and currently so serves and is named in the Mortgage, and no fees or expenses are or will become payable by the Issuer or its assignees to the trustee under the deed of trust, except in connection with a trustee's sale after default by the Obligor. (xxiv) The Loan is an Eligible Loan as of the Closing Date. (xxv) The form of endorsement of each Underlying Note satisfies the requirement, if any, of endorsement in order to transfer all right, title and interest of the party so endorsing, as noteholder or assignee thereof, in and to that Underlying Note, and each form of assignment is in recordable form and is sufficient to effect the assignment of and to transfer to the assignee thereof, all right, title and interest under each Mortgage to which that assignment relates. (xxvi) Each document required under Section 2.6(b) hereof to be delivered to the Trustee on behalf of the Issuer for each Loan meets the requirements of Section 2.6(b) and has been or will be, on or before the Closing Date, delivered to the Trustee. (xxvii) A Phase I environmental report was prepared with respect to each Mortgaged Property or part thereof constituting primary collateral securing the LoanProperty, other than the Mortgaged Properties indicated in the Loan Schedule, prior to the date of this Agreement. To the Issuer's knowledge, each Mortgaged Property was, as of its date of origination of the Underlying Note and as of the Closing Date in material compliance with all applicable environmental laws and regulations. (xxviii) All escrow deposits, if any, and other payments relating to each Loan have been delivered to the Servicer or its agent, and all amounts required to be deposited by the Issuer or the related Obligor have been deposited and there are no deficiencies with regard thereto. (xxix) The Lien lien of each Mortgage is insured by an ALTA lender's title insurance policy (or a binding commitment) or its equivalent, as adopted in the applicable jurisdiction. Except as reflected on the Loan Schedule, the policy (or such binding commitment) insures the originator of such LoanPMC or PMCT, as applicable, its successors and assigns, as to the first priority Lien lien of the Mortgage in the original principal amount after all advances of principal, subject only to permitted encumbrances, none of which, individually or in the aggregate should interfere with the current use of the Mortgaged Property or materially detract from the benefit of the first priority Lien lien of the Mortgage. The originator of such Loan PMC or PMCT, as applicable (including its successors and assigns) is the sole named insured of the policy (or such binding commitment), and the policy (or such binding commitment) is assignable to the Issuer without the consent of or any notification to the insurer. No claims have been made under such policy (or such binding commitment), and the Issuer PMC or PMCT, as applicable has no knowledge of any matter that would impair or diminish the coverage of such policy. (xxx) Each Mortgaged Property is covered by insurance policies providing (1) coverage against loss or damage sustained by (1) fire and extended perils included within the classification "All Risk of Physical Loss" in an amount sufficient to prevent the Obligor from being deemed a co-insurer, and to provide coverage of replacement or actual cost, consistent with industry standards; and the policies contain a standard mortgagee clause naming the mortgagee and its successors as mortgagees and loss payees; (2) flood insurance (if any portion of the Mortgaged Property is located in an area identified by the Federal Emergency Management Agency as having special hazards); and (3) comprehensive general liability insurance in amounts as are generally required by commercial mortgage lenders. The insurance policies contain clauses providing they are not terminable and may not be reduced without 10 days prior written notice to the mortgagee, and all premiums due and payable through the Closing Date have been made. To the Issuer's knowledge, no No notice of termination or cancellation with respect to any such policies has been received by PMC or PMCT, as applicable, which remains effective. The Mortgage obligates the Obligor to maintain all such insurance at its cost and expense, and on the Obligor's failure to do so, authorizes the holder of the Mortgage to maintain such insurance and obtain reimbursement therefore from the Obligor. (xxxi) To the Issuer's knowledge, the Obligor has good title to the Mortgaged Property. (xxxii) The Issuer acknowledges that the Trustee, as assignee of the Issuer with respect to the Contribution Agreement, may enforce any right or remedy thereunder, including any right or remedy with respect to breaches of the representations and warranties thereunder.